Indy Gaming: Red Rock puts focus on older casinos vs. building another resort
Nevada didn’t have anything on the ballot that involved gaming. However, Missouri voters approved sports betting, which will make it the 39th state with the activity when it launches next year. But Missouri voters also rejected a casino at Lake of the Ozarks, disappointing fans of the award-winning Netflix series.
Please click here to sign up for Indy Gaming.
In the 11 months following the opening of the $780 million Durango Casino Resort in southwest Las Vegas, Red Rock Resorts has been pestered about when it will build its next new property — especially given the gaming operator controls more than 450 acres on six vacant sites throughout the valley.
Last week, Red Rock temporarily put the brakes on another casino.
Instead, the company will spend $200 million upgrading hotel rooms and adding amenities to two of its Henderson-area casinos. At the same time, Red Rock is moving forward with a previously announced $116 million expansion to the nearly year-old Durango, adding 25,000 square feet of casino space and a 2,000-space parking garage.
Red Rock executives said spending by the company’s core customer base has remained stable throughout the year. The goal behind the changes is to keep customers engaged by providing new reasons to visit the resorts.
Red Rock President Scott Kreeger said on the company’s quarterly conference call last week the Durango expansion is a “preliminary phase” and sets up the 207-room resort for a second hotel tower and additional entertainment offerings.
Meanwhile, the company wants to give the existing customer base new reasons to visit its properties while focusing on capturing new residents, especially in Henderson, where some 12,500 homes are under development in the Cadence and Sky Terrace communities.
Earlier this year, Red Rock partially remodeled the 27-year-old Sunset Station’s casino, renovated the sportsbook and added a Yard House restaurant. It now plans to add a country-western bar and a Mexican restaurant while renovating the rest of the casino floor. Green Valley Ranch, which opened in 2001, saw a refresh of its casino floor in the past year and will remodel the property’s 495 hotel rooms.
Truist Securities gaming analyst Barry Jonas said refreshing properties is a smart move for Red Rock, given that casino revenues increased 15 percent in the quarter while customer food and beverage spending increased 14 percent.
According to the Gaming Control Board, non-gaming revenue accounted for more than 65 percent of the total revenue produced by casinos statewide in the fiscal year, especially in properties in Clark County neighborhoods where gaming can be secondary to other activities, such as eating out.
The moves by Red Rock mirror those by Boyd Gaming, the company’s largest competitor in the locals gaming market. Boyd, which opened a new sportsbook inside Suncoast before the start of the NFL season, is renovating its Summerlin-area resort with a casino floor refresh and new amenities. Boyd is also building a new casino in the Cadence community — Cadence Crossing — which will replace the 34-year-old Jokers Wild Casino on Boulder Highway.
Red Rock has been focused since 2023 on building a property in the Inspirada community on the western edge of Henderson that would be similar in size and scope to Durango. The company’s 128-acre site near Cactus Avenue and Las Vegas Boulevard was also brought up on the conference call.
Kreeger called the Cactus site “a hybrid location” because of its proximity to the Strip and a “lucrative” locals market.
“We've got a lot of irons in the fire into the first and second quarter with the existing property remodels,” Kreeger said. “We’re probably going to want to see how the market is going into the first half of the year before we make a decision [on the company’s next resort].”
Durango’s performance has been credited by state casino regulators with boosting unincorporated Clark County’s gaming revenue reporting market by almost 12 percent through September. But the casino’s success has come at the expense of other company properties — namely Red Rock Resort, the company’s flagship property that opened in 2005. The casinos are separated by 8 miles along the 215 Beltway.
Chief Financial Officer Steven Cootey said Durango’s “customer cannibalization” wasn’t unexpected.
And, the property’s future remains bright. He said Red Rock Resort and Durango would benefit from 34,000 new residences planned near Downtown Summerlin and the Summerlin West community.
Exec: Optimism follows Sparks Nugget’s quarterly results
More than a year since taking over the Nugget Casino Resort, Century Casinos’ effort to modernize and renovate much of Sparks’ largest gaming property may be paying off.
Officials from the Colorado-based company said improvements made on the casino floor and an increased effort to attract Northern Nevada customers helped increase third-quarter revenue by 40 percent from the previous three months.
Century, which has 11 casinos in the U.S. but doesn’t break out financial results by property, said its overall revenue was $155.7 million, a decrease of 3 percent.
New Nugget general manager Eric Rose, who has been on the job since August, said in an interview last month that Century upgraded the resort’s restaurants and casino floor, adding 120 slot machines and establishing a high-limit room.
“We’re working hard on our marketing database and adding more promotions so we can touch both audiences because they are equally important,” Rose said.
In a research note, Stifel Financial analyst Jeffrey Stantial wrote that gaming revenue from Washoe County locals was up 20 percent from a year ago.
Co-CEO Peter Hoetzinger said on the Century’s quarterly conference call last week that a decline in convention business that began before the company took over the casino was a primary reason revenue and cash flow continue to lag behind 2023 totals. Disruption from construction throughout the Sparks property also contributed to the decline.
“I’m happy to say that it's looking much better going forward,” Hoetzinger said. “New top management successfully focused on cost control [and] total expenses went down by 9 percent.”
Allegiant Stadium was the most popular voting site in Southern Nevada
Allegiant Stadium drew more Election Day voters than any of the 134 other locations where Clark County residents could cast ballots. The stadium, which is home to the Las Vegas Raiders, was set up as a polling location as part of the National Football League’s NFL Votes effort to encourage civic participation.
Allegiant drew 3,942 in-person voters on Nov. 5. The Galleria at Sunset mall in Henderson — with 2,853 voters — had the second-highest turnout among the 14 other sites that drew more than 2,000 voters. In total, 182,178 voters in Clark County cast their ballots in person on Election Day.
Allegiant was credited for its proximity to the Strip, which helped draw resort industry workers. As a bonus, voters received an Allegiant Stadium-themed black and silver “I voted” sticker along with the traditional red, white and blue sticker handed out by Clark County. Voters were also invited to take photos with two of the Raiderettes cheerleaders.
What I'm reading
🏈 'We won almost every game': Inside Nevada sportsbooks' best month ever — David Purdum, ESPN
In September, Nevada sportsbooks won $80.9 million from gamblers, the most ever in a single month in the state's sports betting history.
🍷 Tribes battle over ancestral land — and a casino in California wine country — Julian Mark, The Washington Post
Competition is heating up among Northern California’s Native American gaming market while the Biden administration seeks to relax restrictions.
🎰 With south suburban casino set to open, is Chicago area's gaming market getting oversaturated? — Mitchell Armentrout, Chicago Sun-Times
The new casino adds to Illinois’ gaming options and provides a potential competitor to Bally’s temporary Chicago casino.
News, notes and quotes
🤝Venetian and Pechanga form a customer rewards partnership
The Venetian Resort complex and the Pechanga Resort in Temecula, California, signed a partnership agreement in which each resort's customers would access benefits, amenities and casino club member rewards. Apollo Global Management operates the 7,000-room Venetian and Palazzo complex and the Pechanga Band of Mission Indians owns the 1,100-room Pechanga. The deal is the first between separately owned casino resorts in Las Vegas and Southern California. Palms Casino Resort and Yaamava’ Resort & Casino near San Bernardino, California, are operated by the San Manuel Band of Mission Indians.
🏗️ Penn CEO: M’s expansion comes before any Vegas additions
Penn Entertainment CEO Jay Snowden said the company will “start to play offense” in Las Vegas once the expansion of M Resort is completed in 2026. Snowden made his remarks on Penn’s Nov. 7 conference call with analysts. The company is spending $206 million to add a second hotel tower with 384 rooms to M Resort, bringing its total capacity to 774 rooms and suites. The project will also include expanded meeting space and other amenities. Penn owned the operations of the now-closed Tropicana before selling it to Bally’s Corp. in 2022.
🎰 Full House not planning a Las Vegas casino
Full House Resorts is headquartered in Summerlin, but don’t expect the regional casino operator to expand to Southern Nevada. CEO Dan Lee said on his company’s third-quarter conference call last week the market is saturated with casinos. He credited Red Rock Resorts with opening Durango Casino Resort as “a very good product in a market that was underserved. Everything else in Las Vegas has not gotten a great return. Although we live here and our offices are here, we've kind of avoided it for that reason.”