{"id":31994,"date":"2022-12-02T09:13:47","date_gmt":"2022-12-02T17:13:47","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=31994"},"modified":"2022-12-13T09:58:54","modified_gmt":"2022-12-13T17:58:54","slug":"mgm-change-partners-and-dance-888-tkod","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/mgm-change-partners-and-dance-888-tkod\/","title":{"rendered":"MGM: Change partners and dance; 888 TKO’d"},"content":{"rendered":"\n
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It’s Blackstone Group<\/strong> out, Vici Properties<\/strong> in at MGM Grand<\/strong> and Mandalay Bay<\/strong>, as Vici exercised its option<\/a> over the half (OK, 49.9%) that it didn’t already own. Blackstone is $2.8 billion richer as a result, including $700 million in profit<\/a>. MGM Resorts International<\/strong> will pay $309 million a year in rent. Despite leverage concerns, Deutsche Bank<\/strong> analyst Carlo Santarelli <\/strong>wrote that “the elimination of a messy joint venture structure in an otherwise easy to understand\/forecast business model” was a leading positive. He added, “while the transaction has several fundamentally positive merits, we question whether this transaction would have been feasible\/executed if not for the fact that ~55% of the total purchase price was locked in at an inexpensive cost of debt.” It also increases Vici’s stranglehold on the Las Vegas Strip<\/strong> … but we defer to the experts.<\/p>\n\n\n\n\n\n\n\n

Up and down the Strip there was cause for optimism<\/a>, as October tourism numbers nearly matched those of 2019 (the good old days). A pair of Las Vegas Raiders<\/strong> games, a South Point<\/strong>-branded NASCAR<\/strong> race and a music festival were credited with driving attendance, as hotel occupancy hit 88% even at record-level ADRs of $210 (+55%). Convention business was actually stronger than 2019 by some 20%. Sin City is unlikely to log 2019’s 42 million visitors (although well ahead of last year’s 32 million) but business can hardly be said to be suffering, even if high hotel-room costs may have played into underwhelming Strip gambling revenues in October. 2022 is likely to be a temporary apogee, with tourism boffins expecting a 2023-4 downturn. Said UNLV Center for Business & Economic Research<\/strong> Director Andrew Woods<\/strong>, \u201cThe slight dimming that we see in the model is more because of what the model expects to happen on the national side. We see a softening in the economy and slower growth next year, especially during the first nine months of 2023.\u201d<\/p>\n\n\n\n

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How big a dud was the California<\/strong> sports betting initiative Proposition 27<\/strong>? So big that fewer people actually voted for it<\/a> than signed petitions to put it on the ballot. Prop 27 having cratered (along with Proposition 26<\/strong>) at an enormous cost, B Global<\/strong> founder Brendan Bussmann<\/strong> thinks we won’t see another ballot drive for four years. (We kind of hope he’s right, if only out of what Bussmann calls “voter fatigue.”) Other key takeaways from his latest bulletin are that a Virginia<\/strong> casino in Petersburg<\/strong> looks like an all-but-sure thing, leaving Richmond<\/strong> out in the cold, and that Maryland<\/strong> appears to be a sports betting powerhouse, its launch having engendered 16.5 million-plus wagers from 477K+ accounts. Meanwhile in Nebraska<\/strong>, another racino may open by Christmas, a parting indignity for Gov. Clay Ricketts<\/strong> (R, above<\/em>) who literally put his own money on banning casino gambling and lost big-time. Don’t let the doorknob hit you on the way out of office, guv.<\/p>\n\n\n\n

The last time that the Texas<\/strong> Lege considered casino gambling, Las Vegas Sands<\/strong> parachuted 77 lobbyists in Austin<\/strong> and it backfired spectacularly. Well, those who do not learn from history are repeating it<\/a>. The hard-sell tactics that didn’t go over in 2021 are in for a reprise. True, Sands has cut back its presence … to a mere 72 lobbyists, out of 300 or so (!) who are gladhanding the Lege. Among those spending political capital this time around\u2014Sands went it alone last session\u2014is Tilman Fertitta<\/strong>, along with Caesars Entertainment<\/strong>, BetMGM<\/strong>, Boyd Gaming<\/strong>, DraftKings<\/strong> and FanDuel<\/strong>. Most of them are doubtless planning on Gov. Greg Abbott<\/strong> (R) keeping his campaign promise to “look at” casinos. We still think Abbott’s pledge isn’t worth the paper it wasn’t written upon but if lawmakers are willing to change their minds that might be pressure enough. We hope.<\/p>\n\n\n\n

Arizona<\/strong> sports books made $55 million in September off $537.5 million in handle, but forked over $24.5 million of that revenue in the form of promos. Although 18 operators are jostling for position in the state, 91% of the revenue is concentrated amongst the usual suspects: FanDuel, DraftKings, BetMGM and Caesars Sportsbook<\/strong>. FanDuel raked in $20 million, DraftKings $13 million, BetMGM $11 million and Caesars $6 million, with DraftKings losing market share to FanDuel, which was more generous with free play. Those hoping to make hay by pitting promo against promo have five years in which to do it. As J.P. Morgan<\/strong> analyst Joseph Greff<\/strong> explains: “Arizona allows a deduction [to operators] of for free bets\/promo credit limited to 20% of handle for years one and two, 15% for year three, 10% for years four and five, and no deduction for year six and beyond.” <\/p>\n\n\n\n

Meanwhile, the free market continues to claim casualties<\/a>, as 888 Holdings<\/strong> is pulling SI Sportsbook<\/strong> from any states that don’t also offer i-gaming\u2014which would include Arizona. 888 is reeling from the cost of buying the William Hill<\/strong> assets not controlled by Caesars and is struggling to repay bank loans. Rival Unibet<\/strong> has already retreated from Iowa<\/strong>, while MaximBet<\/strong> and FuboTV<\/strong> are on the canvas. ESPN<\/strong> is getting cold feet<\/a>. BallyBet<\/strong>, unlike 888, isn’t retrenching from non-i-gaming states but it’s not chasing losses in them either. It appears that the sports betting market is going to shake out much sooner than expected.<\/p>\n\n\n\n

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Jottings<\/em><\/strong>: Legal expert I. Nelson Rose<\/strong> contends that the six Macao<\/strong> casino concessionaires now find themselves in the place of the dog that caught the car<\/a>. Why? Because of the absurd government mandates that accompany the renewals. The lone loser, Genting Group<\/strong>, may be the lucky one … The UFC <\/strong>has been kicked out of Ontario<\/strong> due to “integrity concerns<\/a>.” Since when did the UFC have integrity? … Magic City Casino<\/strong> in Florida<\/strong> is ostensibly to be sold<\/a> to Alabama<\/strong>‘s fast-rising, tribal Wind Creek Hospitality<\/strong>. However, Sunshine State regulators want to put the deal on “pause,”<\/a> which Magic City fears will kibosh the sale … Revenues are soaring<\/a> at casinos in Puerto Rico<\/strong>. For fiscal year 2022 they reported GGR of $355 million, a 39% surge. Puerto Rican casinos are taxed at a heinous 50% … Layoffs are taking place at the Golden Nugget Atlantic City<\/strong>, our East Coast correspondent reports. The property is trying to stay out of last place on the Boardwalk … Tyrone Waite<\/strong> is the new CEO of Grey Eagle Resort & Casino<\/strong>, effective yesterday. The resort, located in Alberta<\/strong>, is operated by the Tsuut’ina Nation<\/strong>, and has 1,000 slots and 40 table games.<\/p>\n","protected":false},"excerpt":{"rendered":"

It’s Blackstone Group out, Vici Properties in at MGM Grand and Mandalay Bay, as Vici exercised its option over the half (OK, 49.9%) that it didn’t already own. Blackstone is $2.8 billion richer as a result, including $700 million in … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[135,109,23,293,300,60,244,34,266,274,277,14,26,278,36,120,287,37,86,255,241,62,72,245,122,156,33,262,111,254,25,243,31,114,9,129,19,20,302,215,38,308],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/31994"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=31994"}],"version-history":[{"count":2,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/31994\/revisions"}],"predecessor-version":[{"id":31999,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/31994\/revisions\/31999"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=31994"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=31994"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=31994"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}