How impressive was the Las Vegas Strip‘s July performance? Pretty damned impressive, considering that it hit a best-ever record on only 1% higher visitation than last year and 4% less than in the halcyon year of 2019. Hotel occupany ran at 85% citywide, in a market whose inventory had increased 2% (151,718 rooms) since four years ago. The record was set without notable help from conventioneers, who were 17% fewer in number than last year and 46% fewer than in 2019. There were only 17 conventions in July against 23 in 2022. Room rates edged up 2%, whilst remaining well below 2019 levels. Not only were weekday occupancies strong (82%), weekend ones were 92.5%. Although road traffic at the Nevada/California border was off 5%, airline passenger loads rose 2%. All in all, a formula for success, although we’re keeping an eye on those drive-in numbers.
So long, Casino Royale, we won’t miss you … except for your free parking and lack of resort fees. Those we’ll miss. During her tenure, low-rolling owner Margaret Elardi has kept a commensurately low profile, a far cry for her contentious years at the helm of the Frontier. TheStreet goes a bit overboard and says Casino Royale could be “headed for implosion.” Ha! A couple of shoves with a backhoe ought to do the trick. Still, Casino Royale might make it to its 60th birthday next year, as it seems the Elardi family—while bent on tearning down the old place—has only a vague plan for replacing it. What’s known is that a 669-foot skyscraper is mooted. Casino Royale flies pretty low on our radar, so check in regularly with Vital Vegas for the latest on what might happen. Personally, we don’t think anything will unless the Elardis find somebody with multibillion-dollar pockets to come to their rescue. We’re already moving this into the “Failsino” category.
Hard Rock International is getting into the sale-leaseback game, having just sold its Rockford casino to Gaming & Leisure Properties for $100 million. Mind you, what GLPI is buying (and renting out to Hard Rock at $8 million) could be called imaginary real estate, in that it’s an asset that is yet to be built (pictured). Hard Rock is presently running a temporary casino, and doing rather well at it, in Rockford. Deutsche Bank analyst Carlo Santarelli writes that the temporary is performing “at what we assume is a healthy margin, given the limited amenities inherent in temporary facilities.” So there’s no doubt that the permanent casino will in fact be built, possibly funded from the temporary’s cash flow.
GLPI gets the permanent casino for 99 years, along with right of first refusal on any capex improvements. This is GLPI’s sixth Illinois investment but, given who gaming-centric REITs performed during the pandemic, we have no fears of overexposure. It’s taking out a $150 million loan to contribute toward the $358 million cost of the in-progress final casino. When finished, a year from now, it will offer 50 table games and 1,250 slots. Given the Hard Rock/GLPI combination, it’s difficult not to like the odds for this venture.
Forget about Churchill Downs being a stalking horse for that Richmond casino. It’s come out of the closet with a new name and plan for the formerly Urban One project. You will be relieved to note that the new scheme includes a 55-acre park that will satisfy Virginians’ thirst for pickleball, as well as “film and production studios” that will eke out $5 million a year, according to Urban One’s projections. Mind you, developers’ projections always skew heavily toward best-case scenarios. More crucially, Richmond is predicted to reap $30 million a year in tax revenue. Urban One CEO Alfred Liggins III offered a lot of standard-issue blather which we are not going to repeat here. Richmond voters, who narrowly rejected an earlier iteration of the casino, get to make their feelings known starting Sept. 22.
Today begins Responsible Gaming Education Month. Why only a month? It’s not nearly enough, as Global Gaming Business Publisher Roger Gros is quick to acknowledge. Fortunately, GGB is putting its money where its mouth is by devoting every issue of its weekday news blast to responsible-gambling coverage, starting with a double dose today. Writes Gros, “it’s not all going to be kind to the industry. There are things we can do better—many things. So we hope that everyone involved in gaming reads these articles and takes them to heart.” Unfortunately, some ghost in the machine sabotaged today’s story by Cait DeBaun so that the link takes you to coverage of Hard Rock International’s Grecian misfortune. Whoops.
Jottings: As though to put Boyd Gaming to shame, the San Manuel Band of Mission Indians (along with subsidiary Palms Casino Resort) anted up $125,000 to the American Red Cross for Maui wildfire relief. It was pointedly described as “the first of possible future contributions that San Manuel may consider to help those impacted by the Hawaii wildfires.” If San Manuel, with its two casinos, can afford $125K, surely nationwide Boyd can do better … Sarafina Peterson‘s 106th birthday was doubly auspicious when she spent it at Potowatomi Casino Hotel in Milwaukee. She hit a $1K slot jackpot and was invited to return for a bonus in the form of an additional grand … College of the Redwoods in Eureka, California is hard up for student housing. Big problem? No problem! Not when Bear River Casino Resort steps up to provide ad hoc dormitories in the form of hotel rooms. We’re not sure if Bear River knows what it’s getting into, as college kids can be awfully wild … Clairvest, late of the Tropicana Las Vegas, is converting a former big-box retail space in New Hampshire into a charitable casino. Erstwhile Wall Street stock analyst Marc Falcone is heading up the project, budgeted at $250 million … What do Boyd Gaming and Caesars Entertainment have newly in common? Outbreaks of Legionnaires Disease at their marquee Las Vegas hotels. Guests at both Caesars Palace (2) and at The Orleans (1) tested positive for Legionella bacteria. This is the second occurrence at The Orleans this year. Boyd says it has “extensive measures in place to minimize risk to our guests.” According to Fox Business, “Risk factors may include smoking or being a former smoker, having a weakened immune system and having chronic lung disease.” In other words, exactly the sort of people you’d find in a casino.
