‘Horseshoe’ headed for Las Vegas Strip?

Jun 7, 2005 6:19 AM

It’s a good bet that the first "Horseshoe" hotel and casino on the Las Vegas Strip will be located on the 20-something acres behind Bally’s.

Sources in a position to know say this effort will be the big first move for Harrah’s as it rumbles toward the completion of its acquisition of Caesars.

Last year, Harrah’s purchased the Horseshoe name from Binion’s, as well as the World Series of Poker, which is currently ongoing at The Rio.

It’s dangerous second guessing casino regulators, but it looks like all the i’s and t’s should be dotted and crossed by the first of next week, following this Friday’s meetings of the Gaming Control Board and Nevada Gaming Commission.

The rationale for putting the company’s first Las Vegas Horseshoe at this location includes the fact that Harrah’s wants to hoist the Horseshoe brand to a prominent location as quickly as possible and there’s not a better site than Flamingo Road east of the Strip.

A well-located Horseshoe would also provide a prominent permanent home for the World Series of Poker, which, as a marketing promotion, looks like Superman on steroids after the first few days of this year’s tournament.

Anyone who thinks the World Series will have any trouble surpassing 6,000 entries in the $10,000 buy-in no limit hold’em championship hasn’t been paying attention. After just a week of play, the initial poker events have been so well-attended that some have been extended to three days, beyond the regular two-day schedule.

Before a new Horseshoe is built, there’s speculation that the 2006 World Series of Poker may be held at Caesars Palace. Harrah’s expects to install a first-class poker room operation at the Palace, and until Harrah’s creates something new on the Strip it will not have a better venue for staging poker’s premier event.

Flamingo
to stay put

Also from Harrah’s I’m told there is "no chance" that the company has an interest in selling off the Flamingo once the Caesars deal is completed.

The preference is for keeping all options open as long as possible as the company plots the shape of things still to come.

"The Flamingo’s slot driven business seems to mesh nicely with what Harrah’s already does very well (market slots) and the company’s interests will be much better served if it hangs onto the Flamingo, integrates it and then uses it as a wedge for expanding either to the north or south," said a Harrah’s insider.

Some of the speculation over the Flamingo seems to involve some would-be dealmakers trying to create news that is, as yet, unfounded.

The tiny Barbary Coast next-door, which was built and opened at the corner of the Strip and Flamingo Road for about $12 million in 1979, has been mentioned as a possible component in future Flamingo Hotel deals.

The conjecture is that Boyd could combine the Coast’s several acres with the Flamingo property and suddenly have a high-profile property at one of the most important intersections in the entire galaxy of casino gaming.

Another scenario is Harrah’s buying the Barbary Coast, knocking it down and suddenly finding itself with some impressive frontage on both sides of the Las Vegas Strip. Ownership of the Flamingo will give Harrah’s lots of options on the east side of the Strip.

Building angst

One of the reasons that Boyd Gaming — owners of the South Coast hotel and casino currently under construction — decided to increase the hotel’s number of rooms seven months before its scheduled opening is the resort’s planned equestrian center.

Apparently, so many folks are excited about the horse arena that Boyd officials felt the existing hotel tower wouldn’t accommodate all the potential guests.

Another reason is the escalating construction costs. Executives felt it would be better to build now at today’s prices rather than at a future point when construction costs could be significantly higher.

Penn deal set

Did you know that what will be the third largest gaming company in the U.S. does not own as much as a slot parlor in Nevada?

Penn National Gaming, whose president is former Mirage casino vice president Kevin DeSanctis, will be the third largest — behind Harrah’s and MGM Mirage — once Penn’s acquisition of Argosy Gaming is complete.

DeSanctis stresses that the Pennsylvania-based company looks at all options, but a Nevada property does not appear to be on his radar screen.

Lawyers surfacing

Yes, the lawyers are paving the way for the Poster Financial Group and Barrick Gaming to end up in court in their dispute over who owes what to whom in the wake of Barrick’s failed purchase of the Laughlin Nugget.

Sources familiar with the Barrick position argue Nugget operators breeched elements of the sale agreement.

That’s "definitely not true," say sources close to Poster officials, who contend Barrick was "looking for excuses" after failing to complete its financing under terms of the deal.

For now, we’ll let the lawyers do the talking.

In the meantime, Barrick is believed to have an interest in acquiring the 2,000-room Flamingo Laughlin.

Let the games begin once again!