US gambling revenue dropped 15% in May. In Las Vegas, the percentage is 16.4%. As for Atlantic City, the casinos gambling revenue down 11% in June, comparing with the same month of the last year (a single casino shows an increase in revenue, Harrah’s Resort Casino). In Illinois, gambling revenue was down more than 20 percent in June compared to June 2007.
The analyst Robin Farley of UBS wrote in a report that “the decline in Strip revenues is worse than the period immediately following Sept. 11, 2001 and except for January 2002 is the worst monthly performance in more than 10 years…The weakness in gaming revenues was not confined exclusively to the Strip as the Las Vegas locals market declined 19.5% in May, bringing year to date revenues down 8.7%.”
Sands, Wynn, Boyd… everything is sliding.
“The decline appears to be accelerating,” said Nick Danna, an analyst with Stern Agee & Leach.
Jim Murren, president of MGM Mirage, says that this drop is a temporarily situation, an usual cycle.
For Atlantic City, the most important decline is for Trump Marina Casino, 23%.
For the casino games, the reports say that table games and slot machines fell down almost the same in Las Vegas, but slots declined more in Atlantic City.
I am not a specialist, but I think that there are some important factors, external to the gambling industry, that influence it. And one of the most important, if not the most important, is the economic crisis. Including the petrol price, unemployment, the real estate crisis, as well as the reduction in flights as airlines cut back their services.
A second factor is the tourist market, influenced also by the economic crisis but not only. The restrictions implemented last years by US for the external tourists is, maybe, more important for the tourist market than the crisis.
And, to not forget the smoking ban, that will decrease even more the gambling revenue.
The crisis in US gambling industry will be increased by the casino and hotel investments started by the operators, for which it will not be possible to make the payments to the banks (for ex., Tropicana Entertainment defaulting on $2.7bn debts).
In fact, when you start an isolationist policy, including for the online gambling market, you have to take into consideration the secondary effects that can become major effects, in time.
It seems that it is very hard to make predictions on gambling, this year even more difficult than the other years, and online gambling much more difficult than the classical gambling.
008 will be a very good year for the land casinos. Las Vegas has some big problems that will allow to other entertainment centers to compete successfully with the Sin City.
After several years of standby, Atlantic City will know in 2008 a new development period by building new casinos and improving the old ones.
But Macau will be the star of this year, with the most new projects for casinos, hotels and entertainment resorts. Cotai Strip will be the new center of the gambling world.
The Europeans will have their own Las Vegas too, soon. Gran Scala in Spain is a very ambitious project. This year we will see if it is a certitude for the next years, or just a chimera.
And, to not forget Russia! Russia made no major step till now, but it is very close to invest a lot of money. And, what about the Arabian gambling? Do you bet on the development of a very powerful casino entertainment center in Dubai? The partnership with MGM Mirage is just the beginning. I know about the Islamic rules, but I bet on it.
For me, a big surprise for this year is Harrah’s Entertainment. No big new projects and, at the end of the last year, the bomb (in fact, expected since a year ago): new owners for the casino and hotel resort chain of the world’s largest provider of branded casino entertainment. The surprise is even bigger taking into consideration the successful act of online gambling ban (see UIGEA). So, my prediction is that MGM Mirage will become soon #1 in the casino entertainment industry.
As for online gambling, very bad news, unfortunately. After UIGEA in US, Canada intends to ban the online gambling too, Germany already announced the interdiction for online gambling as well as for advertising the web/based gambling. There are signs that Italy will be soon with Germany on the same part of the barricade and, from the East European countries, Romania has a draft law to ban online gambling and any other related activity since two years ago, so it is possible to discuss it very soon. In this situation, and after the agreement with US, the European Commission it is possible to change its rules about online gambling even this year. I see UK the only country of the European Union that will allow the online gambling in the near future.
It is very interesting how United States, after deciding to ban the online gambling, and by means of the media, it is very close to change the mentality and principles of the whole world about online gambling. Most of the people considered online gambling a way of entertainment as any other, two years ago. Now, the same people are very convicted that they always was against online gambling and online casinos.
A special situation for online poker. If the online poker associations from US will earn the battle to allow this game on Internet (and it is a very powerful lobby for this), all the other countries, including Germany and Canada, will say that they never banned the online poker and will make an exception from the rules. But this will not happen, anyway, this year.
But we will see a spectacular increase of the skill games.
In fact, in the United States the future of the online gambling will be decided during and after the elections stated for this year, 2008. So, when you will vote, take into consideration your own option for online gambling, too.
(These predictions are based on my own experience, do not include any other considerations, I do not claim to be in accordance with the future events, I am not implied in the gambling industry except as a publisher, and I do not advice you to use it)
Harrah’s Casino & Hotel Resort chain, which also run the World Series of Poker, will have new owners, two private equity firms named Apollo Management and Texas Pacific Group, shelling out a whopping $17.7 billion for the acquisition, being complete in early 2008.
“The WSOP will remain a key brand in the Harrah’s portfolio, and one earmarked for expansion on a number of fronts,” said WSOP Communications Director Gary Thompson.
The senior management team, lead by Harrah’s Chairman and CEO Gary Loveman, as well as WSOP Commission Jeffery Pollack and his team, will be kept.
Harrah’s Entertainment, Inc.is a gaming corporation that owns and operates casinos, hotels, and six golf courses under several brands.
Harrah’s Entertainment is the world’s largest provider of branded casino entertainment through operating subsidiaries.
The company known as Harrah’s Entertainment was founded on October 30, 1937 as a small bingo parlor in Reno, Nevada operated by William F. Harrah.
Since its beginning Harrah’s has grown through development of new properties, expansions and acquisitions.
The company went public in 1971 with 450,000 shares. Following that, it was listed on the American Stock Exchange in 1972 and in 1973 Harrah’s becomes the first casino company listed on the New York Stock Exchange. Company founder William F. Harrah died in 1978.
Casinos:
Bally’s brand:
Bally’s Atlantic City (Includes Wild Wild West Casino & Claridge Towers)
Bally’s Las Vegas
Caesars brand:
Caesars Atlantic City
Caesars Indiana (being re branded to Horseshoe)
Caesars Palace Las Vegas
Grand Casino brand:
Grand Casino Biloxi (it will be renamed Margaritaville Casino and Resort)
Grand Casino Tunica (to be renamed Harrah’s Casino Tunica)
Harrah’s brand:
Harrah’s Ak-Chin Casino
Harrah’s Atlantic City
Harrah’s Cherokee
Harrah’s ChesterHarrah’s Council Bluffs
Harrah’s Joliet
Harrah’s Lake Tahoe
Harrah’s Las Vegas
Harrah’s Laughlin
Harrah’s Louisiana Downs
Harrah’s Metropolis
Harrah’s New Orleans
Harrah’s North Kansas City
Harrah’s Prairie Band
Harrah’s Reno
Harrah’s Rincon
Harrah’s St. Louis
Horseshoe brand:
Horseshoe Gaming Holding Corporation
Horseshoe Bossier City
Horseshoe Council Bluffs
Horseshoe Hammond
Horseshoe Casino Tunica
Other casinos:
Bill’s Casino Lake Tahoe
Bill’s Gamblin’ Hall and Saloon, Las Vegas, Nevada
Sheraton Hotel and Casino, Tunica, Mississippi
Casino Windsor (name to be changed to Caesars Windsor in 2008
Conrad Resort and Casino, Punta Del Este, Uruguay
Flamingo Las Vegas
Imperial Palace
O’Sheas Casino (Operated as part of Flamingo Las Vegas)
Harveys Lake Tahoe
Paris Las Vegas
Rio All Suite Hotel and Casino Las Vegas
Showboat Casino, Atlantic City
London Clubs International, UK
Margaritaville Casino and Resort, Biloxi, Mississippi
Golf club and courses:
Atlantic City Country Club – Atlantic City, NJ – Acquired from the Caesars Entertainment merger
Cascata Golf Course – Las Vegas, Nevada
Chariot Run Golf Course – Laconia, Indiana
Cottonwoods Golf Course – Tunica, Mississippi
Grand Bear Golf Course – Gulfport, Mississippi
Rio Secco Golf Club in Henderson, Nevada
Other assets:
Roman Empire Development (RED) to manage room renovation projects internally.
Egypt intends to restrict the right to make copies of its ancient monuments by extending the copyright above 3000 years, claiming royalties for using likenesses of the Sphynx and the pyramids.So, casinos from Las Vegas, Atlantic City, Macau, future Gran Scala or any other entertainment center, will have to pay a royalty for using copies of Egyptian copyrighted monuments or museum pieces.
Zahi Hawass, head of Egypt’s Supreme Council of Antiquities, said his country wanted to own the copyright to its historic monuments and would use any money raised to pay for the upkeep of its most prestigious sites.
“Even if it is for private use, they must have permission from the Egyptian government,” he told the BBC. “The new law will completely prohibit the duplication of historic Egyptian monuments which the Supreme Council of Antiquities considers 100-percent copies,… If the law is passed then it will be applied in all countries of the world so that we can protect our interests”
The discussion about copyrighting the pyramids started short time after some complaints in the Egyptian newspapers that many more tourists visit every year the casinos inspired from the Egyptian monument than the original monument, making reference at the Luxor Hotel in Las Vegas.
Type of the company: Public (NYSE: MGM)
Founded: 2000
Headquarters: Las Vegas, Nevada
Key people: Terrence Lanni (CEO)
Industry: Casinos and hotels
Products: Hotels
Revenue: $7.4 billion USD
Employees: over 70,000
Website: www.mgmmirage.com
MGM Mirage is a Las Vegas – based business engaged in the development, ownership and operation of hotels and casinos. The company began operations on May 31, 2000 by the merger of MGM Grand Inc. and Mirage Resorts, Inc. It is currently the second largest gaming company in the world.
MGM Mirage has significant holdings in gaming, hospitality and entertainment, owns and operates 17 properties located in Nevada, Mississippi and Michigan, and has 50% investments in four other properties in Nevada, New Jersey, Illinois and Macau. MGM Mirage is developing major casino and non-casino resorts, separately and with partners in Las Vegas, Atlantic City, the People’s Republic of China and Abu Dhabi, U.A.E.
Gambling is far from stopping its development all over the world. Asia, Europe, Middle East, Russia, USA, places where the gambling industry is one of the most profitable business.
After four years when it was built the last casino in Atlantic City (Borgata Hotel Casino & Spa), now it is its turn for some of the most important projects in US in the entertainment industry.
Morgan Stanley has purchased 20 acres directly north of the Showboat Hotel and Casino and plans to build another $1 billion-plus resort casino.Revel Entertainment has been named as developer and has announced that it has begun pre-development and design work
Revel Entertainment Group, LLC announced that it has secured a CAFRA (Coastal Area Facility Review Act) Permit for its beachfront casino entertainment resort on twenty acres of land along the Atlantic City boardwalk.
The CAFRA permit includes approvals for Revel’s planned facility which will include two hotel towers with approximately 1,900 rooms each, 150,000 square feet of casino space and 500,000 square feet of dining, retail and entertainment space including a 5,500 seat theater, an expansive health club and spa, meeting space and a one acre private beach. The Company is in the process of determining whether both hotel towers will be completed in the first phase of construction. Earlier this month Revel received preliminary site plan approval from the City of Atlantic City Planning Board including approvals for certain onsite circulation and other infrastructure improvements in connection with the project.
Commenting on the approval, Kevin DeSanctis, Chairman and Chief Executive Officer of Revel Entertainment, said, “Over the last year Revel has made significant progress in advancing its plan to develop a unique resort entertainment casino project. We look forward to continuing our work with local and state authorities and gaming regulators as we commence footing and foundation work shortly to deliver new entertainment experiences for consumers when we open in 2010.”
The twenty acre Revel Entertainment development site is one of the largest, most uniform and contiguous properties in Atlantic City and is located at the northern end of the Boardwalk bordered by Oriental, New Jersey and Metropolitan avenues. The site features over 1,000 feet of beach frontage. (See the Press Release)
Revel is partnering with investment firm Morgan Stanley on the project.
Other casinos will be built by Pinnacle Entertainment on the site of the former Sands Hotel Casino, opening in late 2011 or early 2012.
On October 18, 2007, Pinnacle Entertainment imploded the legendary Sands Casino Hotel in Atlantic City following a dramatic fireworks display. It was the first casino implosion in Atlantic City history and New Jersey’s largest rooftop fireworks display ever. In less than eight seconds, the spectacular implosion brought the 21-story building crashing down into a 33,000-ton pile of concrete and rubble. The implosion paves the way for the development of Pinnacle’s multi-billion-dollar gaming resort.
On November 17th, 2006, Pinnacle Entertainment completed the purchase of the Sands Hotel & Casino and Traymore Hotel sites in the famed Atlantic City, New Jersey.
Together, the land being acquired comprises approximately 18 contiguous acres at the heart of Atlantic City, with extensive frontage along the Boardwalk. We plan to design and build an entirely new casino hotel on the site, which would be among the largest and most spectacular resorts in the region.
“Atlantic City is one of the top U.S. gaming destinations, and we’re looking forward to being a part of the world-famous Boardwalk,” said Daniel R. Lee, Pinnacle’s Chairman and Chief Executive Officer. “This major new resort will be a key component in our plan to build a national network of gaming properties. It will also help extend our development pipeline and our Company’s growth through 2010 and beyond. In connection with our longstanding interest in Atlantic City, we submitted our initial license application in New Jersey several months ago.” (See Press Release)
MGM Mirage planned a $5-billion casino resort in the marina district next to the Borgata, the largest project Atlantic City has ever seen, nicknamed City Center East.
MGM MIRAGE (NYSE: MGM), one of the world’s leading and most respected hotel and gaming companies, owns and operates 17 properties located in Nevada, Mississippi and Michigan, and has investments in three other properties in Michigan and Macau S.A.R. CityCenter is a multi-billion dollar mixed-use urban development in the heart of the Las Vegas Strip; a new MGM Grand hotel and casino complex is being built in downtown Detroit; and the Company has a 50% interest in gaming and has implemented the American Gaming Association’s Code of Conduct for Responsible Gaming at its properties. MGM MIRAGE also has been the recipient of numerous awards and recognitions for its industry-leading Diversity Initiative and it community philanthropy programs.
The project, which is expected to be completed in 2012, will contain up to 3,000 rooms and will have the largest casino floor in the state. Once its built, I think that it will draw big foot traffic both from locals in the New Jersey, New York and Pennsylvania area, and from gamblers throughout the nation. The same thing happened when Borgata opened its doors in 2003. In fact, that property is still one of the biggest draws in Atlantic City even though it’s off the boardwalk and a bit of a hike from the other major casinos.MGM is a partner in the Borgata with Boyd Gaming.
A possible fourth new casino to be built on land near the Atlantic City Hilton Casino Resort by Curtis Bashaw, the former Casino Reinvestment chairman, and Wally Barr, the former chief executive officer of Caesar’s Entertainment, is also on the drawing board. A company headed by Wallace Barr and Curtis Bashaw recently purchased land south of the Atlantic City Hilton, owned by its parent Colony Capital. The tract includes the site of the former Atlantic City High School and the planned but failed Dunes casino. Only the former Dunes site is currently zoned for casino space.
The Atlantic City Hilton is planning a $1 billion (USD) expansion of its physical plant, including a parking garage, 1000-room tower and doubling its casino floor space.
Planet Hollywood has put some interest in bringing a casino/resort to Atlantic City.
The parent company of Tropicana Casino and Resort, Columbia Sussex, is seeking a partner to develop a boutique casino and/or condominium complex on a square city block of boardwalk property north of the Ritz Carlton Condominium Building.
The new casinos will join an already-expanding skyline: The Borgata, Trump Taj Mahal Casino resort, and Harrah’s Atlantic City are all building second hotel towers.
About Atlantic City:
Atlantic City is a city in Atlantic County, New Jersey, USA. Famous for its boardwalk and casino gambling, it is a resort community located on Absecon Island on the coast of the Atlantic Ocean. As of the United States 2000 Census, population was 40,517 in the city, and 271,015 in the combined metropolitan area. Other municipalities on the island are Ventnor City, Margate City, and Longport. The main routes into Atlantic City are the Black Horse Pike (US 322/40), White Horse Pike (US 30) and the Atlantic City Expressway.
Ocean Pier, the world’s first oceanside amusement pier, was built in Atlantic City in 1882. Other famous piers included the Steel Pier, now used as an amusement pier (opened 1898) and the Million Dollar Pier (opened 1906), now the site of a shopping mall. (The oldest cast-iron pier in the world was built at Gravesend, Kent, England, in 1814.)
Casino resorts:
Name
Address
Ownership
Bally’s Atlantic City 1
Park Place and the Boardwalk
Harrah’s Entertainment
The Borgata
One Borgata Way (Also known as 1501 MGM Mirage Boulevard)
Marina District Development Corporation
Caesars Atlantic City
Pacific Avenue and the Boardwalk
Harrah’s Entertainment
Harrah’s Atlantic City
777 Harrah’s Boulevard
Harrah’s Entertainment
Atlantic City Hilton
Boston Avenue and the Boardwalk
Colony Capital
Resorts Atlantic City
North Carolina Avenue and the Boardwalk
Colony Capital
Showboat
South States Avenue and the Boardwalk
Harrah’s Entertainment
Tropicana
Brighton Avenue and the Boardwalk
Columbia Sussex
Trump Marina
Huron Avenue and Brigantine Boulevard
Trump Entertainment Resorts
Trump Plaza
Mississippi Avenue and the Boardwalk
Trump Entertainment Resorts
Trump Taj Mahal
Virginia Avenue and the Boardwalk
Trump Entertainment Resorts
1 Claridge Tower and the Wild West Casino are considered part of Bally’s.
On November 16, 2006, Hal Handel, CEO of Greenwood Racing, announced that the Atlantic City Race Course would increase live racing dates from four days per year, to up to 20 days per year. www.saveacrc.com has been actively involved in expanding racing at the Atlantic City Race Course and created the movement to bring full time racing back to ACRC in 2005.
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