After years of hand-wringing about the future of Atlantic City, there is a sudden imperative to do something about the seaside resort. It’s gone from a leadership vacuum to possibly having too many chefs in the kitchen. State Senate President Stephen Sweeney (D, left) is proposing the creation of a private-sector version of the CRDA to channel money from theoretical Meadowlands and Jersey City casinos. (“I just don’t want to give money to government, because I know what they do with it.”) From the point of view of Sweeney and others, Gov. Chris Christie‘s five-year grace period for Atlantic City but the sudden collapse of the casino market there calls for extraordinary measures.
Even Christie seems to be softening towards elements of Sweeney’s scheme, saying, “any expansion of gaming to other parts of the state would have to have, as an element to that plan, Continued >>
Orange Capital, calling itself “unsatisfied,” has renewed its pestering of Pinnacle Entertainment to convert itself into a REIT. Orange claims that share value could be increased 60% to 90%. Unfortunately for Pinnacle customers, REITs are required to return 90% of taxable earnings to shareholders, which could have a deleterious effect on Pinnacle’s casinos, known for their quality.
It’s not like Pinnacle is on its uppers. Net revenue in the most recent quarter grew 108%, thanks to the absorption of Ameristar Casinos and to some recent cost-saving measures. (Not enough to stave off a $2.3 million loss, though.) “While so far trends are looking better than the second quarter, the change has not been meaningful,” said Continued >>
Boston Mayor Martin Walsh isn’t getting off the hook so easily. He tried to fob the negotiation of a mitigation agreement with Wynn Resorts off on the Massachusetts Gaming Commission. The latter said ‘not so fast’ and ordered the city back to the bargaining table. And if that doesn’t work, the MGC will appoint an independent arbiter to cut the Gordian knot. “The city’s basically, without telling us why, said they’re … just abandoning that [Charlestown] section of the city,” explained Commissioner James McHugh. “We have some obligation to protect it. At the same time, we’ve got to maintain our neutrality.”
While somewhat craven, Walsh’s refusal to go to arbitration and risk the 50-50 chance of being stuck with the Wynn offer is understandable. While Mohegan Sun is offering an extra-george $30 million upfront and $18 million a year, Wynn has only put $6 million and $2.6 million, respectively, on the table. There’s no comparison, so one can see why Walsh would fear to be stuck with the Wynn offer, if that were the case — especially if Continued >>