$400 million Biloxi Golden Nugget in jeopardy

Dec 13, 2005 3:37 AM

Tilman Fertitta, chairman and CEO of Landry’s Restaurants Inc. (LNY) has encountered his first major hurdle in an attempt to expand the Golden Nugget brand he acquired by buying the Golden Nugget Hotel/Casino in Las Vegas.

A proposal to build a $400 million casino in the Gulf Coast city of Biloxi, Miss., was placed in jeopardy on Friday when the community leaders began playing hardball over the price of city-owned land selected as the site of the casino project. In fact, the city raised by 60% the cost of leasing the property.

Landry’s had proposed the development on Nov. 10 and had asked the city to "reply without delay."

The city’s reply was not what was expected.

Biloxi Mayor A.J. Holloway said he is committed to achieving the best deal for the city and will not rush into important decisions.

Landry’s responded by setting a Dec. 15 deadline on a decision with the added comment that it had "no alternative other than to terminate" its contract for adjacent privately owned property unless an agreement can be reached by that date.

And even if an agreement is reached, the city must offer the plan to Isle of Capri Casinos Inc. (ISLE) since that company has a "right of first refusal" on the Point Cadet site.

Wynn backs out

It’s beginning to read like an Agatha Christie novel. What started out as 10 bidders for the license to build a casino complex in Singapore, now is down to five serious contenders.

Among those that backed out last week were Wynn Resorts Ltd. (WYNN) and Tabcorp Holdings Ltd., Australia’s largest provider of racetrack simulcasting transmissions.

Still in the running on Monday were: Las Vegas-based Harrah’s Entertainment Inc. (HET), MGM MIRAGE Inc. (MGM) and Las Vegas Sands Corp. (LVS); Malaysia’s Genting Corp., and the partnership of Australian billion Kerry Packer and Macau gambling mogul Stanley Ho.

Current plans call for two casinos to be built in Singapore. One will be located in the city’s Marina Bay, just outside the central business district, and the other on the resort island of Sentosa.

Wynn said that he had too much on his plate to add a Singapore project. Next year, he plans to begin building a 2,030-suite Encore facility, next to the Wynn Resort on the Las Vegas Strip, and he will open his Wynn Macau Hotel/Casino in September.

Casino win

Thanks to Gov. Guinn’s plan to rebate up to $300 million in tax revenues to Nevada residents, the state’s casinos set another record in October, winning $1.06 billion, a jump of 14.4% over the corresponding month in 2004.

Frank Streshley of the Nevada Gaming Control Board, who monitors the monthly revenues, credited the mailing of $270 million in Nevada vehicle fee rebates as a stimulus to "the best month ever in the history of gaming revenue."

The so-called locals market including North Las Vegas, the Boulder Highway area and Henderson wracked up $197.2 million in winning, an increase of 27.4 percent over the prior year.

Even Downtown Las Vegas, hard pressed in recent months, showed an increase with winnings of $60.7 million, a respectable increase of 4.8% over last year’s $57.9 million.

However, the big numbers, as is usually the case, came from the Strip casinos that reported winnings of $884.1 million, a 15.2% boost over last year’s $767.2 million.

Boyd’s big names

Joined by some of the biggest names in Pennsylvania business and politics, Boyd Gaming Corp. (BYD) has entered the fray to get a slots machine license for a facility in the Philadelphia suburbs.

Partnering with Boyd Gaming are David Sweet, campaign manager in 2002 for Gov. Ed Rendell; Thomas Brogan, prominent gambling lobbyist; Hershey businessman Silvan Lutkewitte III, and Pat Rooney, a member of the famous family of the late Art Rooney, owner of the Pittsburgh Steelers.

Rob Stillwell, spokesman for Boyd Gaming, called the Montgomery County site proposed for a slots parlor as an "underserved market." He said the parlor would appeal to the residents of the densely populated suburbs north and west of Philadelphia.

Under the gaming law passed by the Pennsylvania lawmakers, Philadelphia will have two slots licenses.

THE INSIDER: The official opening of South Coast Hotel & Casino on the south end of Las Vegas Boulevard will be at 7 p.m. on Dec. 22, according to an announcement Monday by owner Boyd Gaming Corporation (BYD).

Isle of Capri Casinos Inc. (ISLE) has agreed to pay the town of Kimmswick, Mo., $14.3 million to settle a lawsuit stemming from a decision four years ago to scrap plans for a casino to be built in that community.

A deal emerged Monday that would permit the New York Racing Association (NYRA) to sell 80 acres of land near Aqueduct racetrack to the Port Authority of New York and New Jersey. Final arrangements are still developing.

Cliff Goodrich has resigned his post as president of Arlington Park racetrack, a property owned by Churchill Downs Inc. (CHDN). He was a longtime executive on the California racing circuit, having served as head of Santa Anita Racetrack.

Dan Rakieten, who has been operating the family-owned Jackson Raceway in Jackson, Mich. for the past few years, has sold the facility for $2 million to Mountaineer Racetrack & Gaming Resort (MTNG).

Scientific Games Corp. (SGMS) has agreed to a three-year contract that requires that the company continue to provide cooperative services to the Delaware Lottery for instant tickets, software and attendant services.