Indy Gaming: 13 months later and still no M Resort expansion
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It’s been more than a year since Penn Entertainment revealed plans to double the size of the M Resort in Henderson, a $206 million expansion that would add a second 378-room hotel tower, additional meeting space and other amenities.
But since the announcement was made during the 2022 Global Gaming Expo, company officials have barely mentioned M Resort.
During last week’s third-quarter earnings conference call, Penn CEO Jay Snowden spent the bulk of the question and answer session with analysts discussing the company’s upcoming launch of its multibillion dollar sports betting partnership with ESPN.
M Resort was an afterthought.
Snowden said the Henderson resort was one of the casino operator’s “highest-performing properties” along with the Hollywood Casino in Columbus, Ohio, which is also targeted for an expansion. Penn plans to spend $800 million combined on expanding M Resort, Hollywood Columbus and two Illinois casinos.
Penn has not given any schedule for the casino expansions, including for the M Resort. In its initial announcement, Penn didn’t provide a timeline for M Resort and company executives have declined interviews about its plans for the Henderson casino.
The M Resort expansion budget is the second largest of the four casinos.
“We expect these four growth projects to deliver a 15-plus percent cash-on-cash return,” Snowden said. “These projects will also contribute to our strong free cash flow generation upon opening in late 2025 and early 2026.”
Given Penn’s 10-year, $1.5 billion deal to launch ESPN Bet on Nov. 14 in 16 states, the investment community was more interested in that deal than a casino expansion in Henderson.
Nevada is not one of the states where Penn operates sports betting. The company's three in-state casinos — M Resort and two small properties in Jackpot near the state’s border with Idaho — have William Hill US sportsbooks.
The ESPN deal is Penn’s second effort at sports betting, having scrapped a three-year endeavor in August with the irreverent sports website Barstool Sports, which Penn acquired for $551 million. The company allowed Barstool founder Dave Portney to buy back the company for just $1.
ESPN and Penn will launch an advertising campaign for the new sports betting app, with SportsCenter anchors Scott Van Pelt and Elle Duncan spearheading the effort.
“The success of the partnership will all hinge on [Penn’s] ability to sustain market share after the initial launch driven by its product and technology,” JMP Securities gaming analyst Jordan Bender wrote in a research note last week. “Penn's ability to reach across the sports betting landscape will increase the market size, bringing in new players and seeing upticks in gaming revenue compared to [Barstool].”
The Nevada Gaming Control Board includes Henderson’s monthly gaming revenue total within the Boulder Strip reporting area, which saw two casinos — Boyd Gaming’s Eastside Cannery and Red Rock Resorts’ Fiesta Henderson — closed after the pandemic.
Boulder Strip revenue was almost $966.7 million in 2022, roughly $1 million less than the previous year’s single-year record of $967.5 million. Through the first nine months of 2023, gaming revenue is down 1.6 percent.
Red Rock, which is opening the $780 million Durango Casino and Resort on Dec. 5, may begin construction next year on a similar project in the Henderson community of Inspirada, which is 3 miles from M Resort.
Analyst: Cyberattack to blame for September’s Las Vegas visitation decline
CBRE Equity Research analyst John DeCree said the cyberattack on MGM Resorts International was the reason the Strip saw a small decline in September visitor volume.
The attack left the company’s nine Strip resorts “completely in the dark” for a little less than a week, according to CEO Bill Honrnbuckle.
DeCree, commenting on the Strip seeing 3.33 million visitors in September — roughly 18,300 fewer visitors than a year ago — said MGM’s September occupancy was 88 percent, compared to 93 percent in September 2022.
“Despite the moderate decline in visitors and occupancy, non-gaming spending remains strong,” DeCree wrote in a research note. He said hotel room rates were up 8 percent and the live entertainment tax — a 9 percent fee assessed on ticket sales for various events — grew 21.7 percent.
“This highlights strong consumer demand for experiential entertainment,” DeCree wrote.
Circa Sports' latest expansion takes the company to the Silverton
Circa Sports opened a sportsbook inside Legends Bay Casino in Sparks a year ago to establish a presence in Northern Nevada.
A similar project planned for the Silverton Casino on Blue Diamond Road near Interstate 15 offers Circa a chance to draw business from a different Las Vegas customer market.
Circa’s signature location is its three-level showcase in downtown Las Vegas; the company has satellite facilities at The Pass Casino in Henderson and the off-Strip Tuscany Suites on East Flamingo Road.
Circa Sports CEO Derek Stevens told the Gaming Control Board last week that the deal with the Silverton would create more than just a sign-up and deposit center for Circa’s mobile sports betting accounts. Circa, he said, is making a “significant investment” to take over a space being vacated by Caesars-owned William Hill US and will hire the staff to operate the location.
Stevens said a temporary sportsbook will be open by New Year’s Day with the permanent facility completed in time for March Madness.
Southern California-based advisory firm Eilers & Krejcik Gaming said Circa has been either Nevada’s third or fourth-largest sports betting provider, alternating spots with the Red Rock Resorts-owned STN Sports.
Outside Nevada, Circa has mobile sports betting operations active in Colorado and Iowa and retail sports sportsbook and mobile wagering in Illinois through Full House Resorts’ casino north of Chicago.
News Notes and Quotes
‘Paramount Mountain’ to replace Mirage volcano — temporarily
Paramount Global announced last week that it will construct an interactive fan experience atop The Mirage volcano ahead of Super Bowl LVIII in Las Vegas in February. The company is the parent of CBS, which is televising the championship game from Allegiant Stadium on Feb. 11.
“Paramount Mountain,” which will operate for four days starting Feb. 8, will include a gondola ride and attractions that promote the network’s programs, including “Transformers,” “Yellowstone,” “Star Trek” and “Dora The Explorer.”
Hard Rock International acquired the operations of The Mirage from MGM Resorts International a year ago for $1.1 billion and plans to demolish the volcano as part of a remodel of the Strip resort.
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Gaming attorney Scott Scherer appointed to the Nevada Ethics Commission
Scott Scherer, a former member of the Nevada Gaming Control Board, was appointed to the Nevada Commission on Ethics by Gov. Joe Lombardo. Scherer, who also served as general counsel and chief of staff for Gov. Kenny Guinn, is an attorney in the gaming division of Brownstein Hyatt Farber Schreck.
“Scott brings decades of legal, regulatory, and government experience to this role,” Lombardo said in a statement.
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Full House announces opening for Colorado casino
After more than two years of development, Las Vegas-based Full House Resorts said its $250 million Chamonix Casino Hotel in Cripple Creek, Colorado, will open Dec. 26. The 300-room resort is the largest property in the historic mining community, located a one-hour drive from Colorado Springs.
Chamonix is designed and themed to resemble Chamonix-Mont Blanc, the French alpine resort and site of the first Winter Olympics in 1924. When it opens, Chamonix will be Full House’s seventh hotel-casino in five states.
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Digital payments provider Koin names Bob Woodbury COO
Koin, a Las Vegas-based digital payments provider that is a sister company of cashless technology system Marker Trax, named Bob Woodbury as chief operating officer. Woodbury was a top executive with non-gaming industry payment providers. Koin and Marker Trax were founded by Ellis Island CEO Gary Ellis.
Koin and Marker Trax provide cashless payment technology to Baldini’s Casino in Reno and Minnesota-based game developer Table Trac.
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UNLV names new executive director for its gaming regulatory center
UNLV’s International Center for Gaming Regulation named Megan Basson as its executive director. The center, which is part of the school’s International Gaming Institute and UNLV’s Boyd School of Law, is dedicated to the study of gaming industry regulatory matters.
Basson brings almost two decades of gaming-related experience to the position and most recently served as the head of the licensing department for the Western Cape Gambling and Racing Board gambling operations in the Western Cape Province of South Africa.
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BetMGM expands to New Mexico
BetMGM, the sports wagering subsidiary of MGM Resorts International, opened a sportsbook last week at the Isleta Resort & Casino in Albuquerque, New Mexico. The 4,900-square-foot betting space is BetMGM’s 28th jurisdiction in the U.S. and Canada.
The casino is owned by the Pueblo of Isleta Tribe. The sportsbook has 35 televisions, two VIP sections, five betting windows and four betting kiosks.