Sands’ new strategy: Blame Genting; Big Gaming backs Romney

By David McKee ~ February 15th, 2012 @ 3:46 pm

First, the good news. Las Vegas Sands is signaling that it is not going to take its ball and come home from Florida, regardless of what lobbyist Nick Iarossi said last week. However, Sands’ emissary to the Sunshine State, Andy Abboud, unleashed his wrath upon Walt Disney Co. and the Florida Chamber of Commerce for acting out of — gasp! — “selfish financial self-interest.” You mean, like your boss does when the Las Vegas Convention & Visitors Authority horns in on the business-meeting market?

Abboud having played the role of outraged carpetbagger, Iarossi turned on Genting Bhd., the favored whipping boy of casino proponents and opponents alike. Even though Sands had spent considerable money on lobbyists like himself, Iarossi felt no compunction about being the pot who called the kettle black. It was Genting‘s lobbyists who were to blame, he asserted, with their “big money splash.” Skepticism about the viability of Genting’s $4 billion, six-tower, 5,200-room project (left), with its proposed 5,000-6,000 slot machines and 300,000 square feet of casino floor (!) is well warranted, there’s a double-standard at work. By what line of reasoning do Sheldon Adelson‘s proxies say that three privately owned casinos at an aggregate cost of $6 billion-$8 billion is Too Much Gambling, but five or six Sands-owned resorts (the original proposal) at a total budget of $12 billion is Just Right? If the casino movement in Florida was hobbled, one of the people kneecapping it was Adelson himself, with his Debbie Downer pronouncements about insufficient market capacity and attempts to scale back the expansion to own casino — proving that you can be right and intellectually dishonest in the same moment. Sheldon’s qualms about the size of Florida’s gaming appetite only arose when it became clear he wasn’t going to have the sandbox to himself. And Iarossi’s suggestion that no significant casino opposition would have arisen if the lobbying had been left in his capable hands — and those uppity Malaysians had stayed in their place — is so absurd I’m surprised he could utter it with a straight face.

Abboud and Iarossi did get in some good licks on casino opponents, such as pointing out that whenever the Florida Chamber speaks, you can see Disney’s lips move. Even more to the point, Abboud (left) says critics of Florida Internet cafes and maquinitas parlors, where gambling flourishes, should direct their ire at the Mouse House and its Chamber of Commerce surrogates. “They’ve allowed the worst types of gambling to continue,” he said with justifiable ire, since the Legislature will have adjourned without hammering those loopholes shut. Sands execs can be pretty hoity-toity sometimes but that doesn’t necessarily make them wrong.

Rowan & Black’s Laugh-in. Private-equity firms would like to further mask their dodgy deals from prying eyes like yours and mine, have greater license to run amok (as they did in 2005-08) and generally befog what limited transparency they must observe. In pursuit of this goal, Apollo Management, Texas Pacific Group, Goldman Sachs, John Paulson and others have been getting together to nibble on “brie-stuffed French toast” and hobnob with presidential candidate Mitt Romney. Apollo, TPG and Paulson all own pieces of Caesars Entertainment, TPG co-owns the Palms and the TPG/Apollo terrible twosome recently added Aliante Station to its portfolio. Goldman is not only the proud receiver of the newly foreclosed Las Vegas Hotel & Casino but owner of American Casino & Entertainment Properties, which include the Stratosphere tower. Marc Rowan, who co-founded Apollo with Leon Black, offers this uproariously self-serving remark: “Where we look for opportunity on our new investment side is where there has been complete destruction.” As any Las Vegan can tell you, at Caesars the “complete destruction” didn’t occur until Rowan took over.

A cheapskate to the bitter end, Colony Capital, whose casino holdings have shriveled to the Boardwalk’s illustrious ACH, is backing Romney to the tune of a relatively paltry $10,000. And a search of Federal Election Commission records reveals that Donald Trump‘s recent, much-ballyhooed, Las Vegas Strip “endorsement” of Romney was just more self-aggrandizing bullshit from a blowhard: Das Donald had been on Romney’s bandwagon since Dec. 19, when he gave $2,500. Only when there was publicity to be had did Trump put his mouth where his money was. (Green Valley Ranch recently hosted a Ron Paul appearance but if there are any Rick Santorum supporters in the casino industry, I’ve yet to locate them.) But, with the exception of Sheldon Adelson, casino CEOs are playing it pretty cool right now.

Boardwalk boycott. In a small but potentially significant setback for the Tropicana Atlantic City, it’s losing the patronage of the New Jersey Policemen’s Benevolent Association. The police union is holding its convention at Bally’s Wild Wild West, which is in good standing with Unite-Here. But it’s New Jersey‘s finest to give the Trop a wide berth. Carl Icahn‘s minions are attempting to steer employee pension away from the union and into the dubious safety of a company 401(k), pleading “long-term financial stability.” Of course, it’s no great feat of imagination to see that the next step towards “stability” would be to cease 401(k) matches altogether, leaving Trop workers up Absecon Inlet without a paddle. If the 2,500 NJPBA members heed leadership’s behest and boycott the Trop, other conventioneers will almost certainly feel pressure to follow suit.

If you don’t know the name of Tony Hsieh, you soon will. The Zappos.com CEO has become the mover and shaker in Downtown. At a time when Steve Wynn and Sheldon Adelson are perceived locally as having turned their backs on Las Vegas in favor of China, and the gaming industry as a whole has become disconnected from Sin City, its citizens are looking to Hsieh as a potential savior. We’ve seen grandiose schemes rise and fall (mostly fall, lately) but Hsieh is putting his money where his vision is. Compare that to Tamares Group, which has given Downtown seven years of lip service and one belated, half-hearted, $35 million redo of the Plaza. Not very impressive, on balance. Hsieh’s buying up real estate and Tamares has a lot of ex-Jackie Gaughan acreage laying fallow. Perhaps the entrepreneur can extract the Lichtenstein-based conglomerate from at least some of its Downtown quagmire.

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