Good morning, and welcome to the Indy Gaming Newsletter, a weekly look at gaming, nationally and internationally, and how events are heading back to Nevada.
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More than a year after announcing a deal to acquire Tropicana Las Vegas, Bally’s Corp. that it will close the $308 million transaction by the end of September.
However, executives at the Rhode Island-based company said last week that it will take well into 2023 for a redevelopment to take place at the 34-acre South Strip site.
That schedule may not fit the Oakland A’s timeline. The Major League Baseball team has reportedly targeted the Tropicana site as a $1 billion, 35,000-seat stadium site, should the A’s choose to move to Las Vegas.
“I think it’s been well advertised that we plan to develop (the site) at some point in the future,” Bally CEO Lee Fenton said during the company’s second-quarter conference call last week. . “But we will leave the property unchanged for at least the next 12 months until we identify the plan and partnerships we want to have in the future.”
A’s executives have said they want to make a decision about a new home this year. The team wants to build a $1 billion waterfront baseball field in Oakland to replace the 57-year-old RingCentral Coliseum. The proposed stadium is the centerpiece of a $12 billion mixed-use project at the Howard Terminal in the Port of Oakland.
However, numerous approvals are still needed from Bay Area elected leaders, and the team is on “parallel paths” to land a new stadium in Oakland or move to Las Vegas. The Tropicana is one of two locations in the resort hallway that the team is exploring for a baseball field. A 27-acre lot owned by VICI Properties along Koval Lane behind Planet Hollywood and Paris Las Vegas is also reportedly being considered.
Bally’s first announced its acquisition of the Tropicana in April 2021 as part of its $308 million deal with the real estate investment trust Gaming and Leisure Properties, which owns the site. Bally’s said it would pay GLPI $10.5 million per year to lease the site under a 50-year lease that is subject to increases.
GLPI General Counsel Brandon Moore said a week earlier that the company was aware that Bally’s is considering redeveloping the Tropicana site and “clearly (has) a strong interest in the eventual plans.”
Bally’s purchase of the nearly 1,500-room Rat Pack-era property has yet to be approved by Nevada game regulators. The issue is currently not on this month’s agenda.
It is thought the company would rename the resort under the Bally’s brand, as it has done with 13 of its 14 casinos, including the Evansville, Indiana estate, formerly known as Tropicana Evansville.
Caesars Entertainment turns Bally’s Las Vegas into Horseshoe Las Vegas. Caesars also owns Tropicana Atlantic City, but has not announced plans to rebrand that property.
Bally’s CFO Bobby Lavan said the Tropicana Las Vegas would initially produce $6 million in quarterly cash flow once the company takes over the business. Penn Entertainment has owned the Tropicana since 2015, but sold the property and resort facility to GLPI in March 2020 during the pandemic.
Analysts didn’t comment much on the Tropicana deal, drawing attention to Bally’s interactive gaming division and the company’s planned casino in Chicago.
Bally’s said it would spend $70 million to open a temporary casino by June next year, while keeping its $1.7 billion permanent hotel-casino in the former Chicago Tribune downtown site along the Chicago River. The resort is expected to open in 2026.
Golden Evaluation Plans for Colorado Belle with shutters in Laughlin
Golden Entertainment maintains its gaming license for the Colorado Belle Casino Hotel in Laughlin, which has been closed for 29 months, but the company is evaluating plans to own a riverboat.
Las Vegas-based Golden currently operates two casino hotels in the Colorado River gaming community, the 1,900-room Aquarius and the 1,052-room Edgewater. The nearly 1,200-room Colorado Belle is adjacent to the Edgewater.
“That’s a unique piece of riverbank real estate and has a multitude of potential uses,” said Golden CEO Blake Sartini during the company’s second-quarter conference call last week. “I won’t go into what we researched.”
The Colorado Belle is the largest of five Southern Nevada casino hotels that have not reopened since the 2020 pandemic caused a 78-day shutdown of gaming.
Last month, Red Rock Resorts said it would demolish its three closed properties — Fiesta Rancho and Texas Station in North Las Vegas and Fiesta Henderson — then vacate the sites and sell the land without the game rights.
Boyd Gaming has no plans to reopen or demolish its Eastside Cannery property on Boulder Highway. The company said that customer demand in the market is not strong enough to handle any other casino. Boyd also operates Sam’s Town in close proximity to the cannery.
Sartini made similar comments about Golden’s presence in the Laughlin market.
“I think the capacity we currently have with the rooms and casino inventory is adequate for what we see happening down there,” Sartini said. “That market could use an important traffic driver at some point.”
Laughlin, one of two markets in the state not to set a gaming revenue record in 2021, has more than 8,600 hotel rooms. Located 90 miles from Las Vegas and across the Colorado River from Bullhead City, Arizona, the community has seen 624,500 visitors through June, according to the Las Vegas Convention and Visitors Authority, a decrease of less than 1 percent from 2021.
Golden operates the Laughlin Events Center, which has an active performance schedule.
Without Colorado Belle, Golden and Caesars Entertainment are essentially linked as Laughlin’s largest casino operators. Caesars has the 1,500-room Harrah’s Laughlin and the 1,450-room Tropicana Laughlin.
Even with Colorado Belle remaining inactive, Golden is looking at acquisition opportunities, including slot machine routes in markets outside Nevada, where it is the largest operator of gaming in taverns, bars and other third-party venues.
Deutsche Bank gaming analyst Carlo Santarelli suggested Golden would look into Nevada casino opportunities given the company’s presence in Las Vegas, Laughlin and Pahrump.
“Buy-side M&A opportunities would be more of a (casino) recycling effort, with Golden likely to sell a non-core (casino) or (casinos) prior to an acquisition,” he wrote in a research note following the conference call.
Through The Associated Press
Hard Rock Atlantic City president Joe Lupo will head to Las Vegas later this year to run The Mirage once Hard Rock Entertainment takes ownership of the Strip resort. The company is buying the property for approximately $1.1 billion. Lupo worked in Southern Nevada for several Boyd Gaming properties, including the former Stardust. He went to Atlantic City when Boyd owned the Borgata.
“The last four years in Atlantic City have been such a rewarding experience for me. I am humbled and excited to be appointed as the new president of the Hard Rock Hotel & Casino Las Vegas project and to return to my family.”
– Joe Lupo, President of Hard Rock Atlantic City
Through The Nevada Independent
Operators of the Sapphire gentleman’s club are seeking approval from Clark County for a dozen bar-top slot machines, which allegedly violate regulations against gaming in an adult nightclub and topless lounge. Gaming industry leaders are supportive because Sapphires is located opposite the entrances to Resorts World Las Vegas and next to Thrive Cannabis Marketplace, a pharmacy that has applied for a marijuana license.
“I would suggest it is premature to consider adding another right to this location until you know how the previously approved rights will perform.”
- Virginia Valentine, president of the Nevada Resort Association
Through Penn Entertainment
As part of the release of its second quarter results, Penn National Gaming said it is renaming the company Penn Entertainment, reflecting its multifaceted business, which includes 44 casinos in 20 states, sports betting and online casino gaming. In Nevada, Penn M Resort, operates two Jackpot casinos and sells the Tropicana Las Vegas.
“Our new name remains connected to our legacy and better reflects our evolution into North America’s leading provider of integrated entertainment, sports content and casino gaming experiences.”
– Jay Snowden, CEO of Penn Entertainment
Via MGM Resorts International Second-Quarter Conference call
MGM Resorts owns 50 percent of the BetMGM digital gaming business. The company last year tried to buy the remaining 50 percent from its partner, European gaming operator Entain Plc, but the offer was rejected as “too low”. UBS gaming analyst Robin Farley asked if MGM still wanted 100 percent ownership of BetMGM.
“We think about it all the time. It would be foolish to think otherwise. And you cannot buy what cannot be bought. We remain sharply focused on BetMGM. We want more of it. … We continue to follow the math and we understand it very well. But for now, we don’t have a story there.”
– Bill Hornbuckle, CEO of MGM Resorts