Issue 244
May 16 - May 23, 2005
Volume 5
page 1
 

This Issue

Gaming News

Owners plan Lady Luck renovation

New casino plans leave Iowans with mixed reactions

Prairie Band Potawatomi Nation To Assume Management Of Harrah's Prairie Band Casino in 2008

Manchester United applies to build casino complex

Emmetsburg Gets Casino 

Show Time Brad Garrett performs at Tropicana Casino and Resort.

Column The Secrets of Laying the Fives and Nines By Larry Edell.

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Owners plan Lady Luck renovation
As reported by the Las Vegas Sun

LAS VEGAS, Nevada - The management company running the Lady Luck casino has purchased the downtown property from its landlord and plans to remodel it in addition to expanding the casino and hotel.
Las Vegas-based Henry Brent Co., whose majority owner is Timbers bar and grill chain founder Andrew Donner, last month purchased the 758-room property for $10.3 million from a private real estate company based in Newport Beach, Calif.

Henry Brent is working with Strip casino architect Klai Juba on a major remodeling effort that will involve gutting and refurbishing parts of the property, Donner's business partner Keith Grossman said. The company also expects to add about 20,000 square feet to the casino floor and eventually build up to 1,000 hotel rooms at the site of two old towers on the property -- one at two stories and another four stories high.

The remodeling work is expected to begin in about three months and cost up to $25 million. The entire master plan, including the expansion, could take up to three years, Grossman said. The Lady Luck's existing 780 or so employees, minus a few management workers who were with the former landlord, will remain with the property, he said.

The management company, which had the first right to purchase the property as part of its lease agreement, jumped at the chance to buy the Lady Luck, Grossman said.

"Our plan all along was that we'd be the tenant and operate the casino," he said. "We always had a desire to buy the property but we just didn't think it would come up."

The Newport Beach company that sold the Lady Luck, called Steadfast AMX, was new to Las Vegas and intended to enter the timeshare business.

AMX converted about 16 hotel rooms on two floors to timeshares as individual signed up to buy, attracting more than 600 owners.

Grossman said he didn't know why AMX decided to abandon its timeshare experiment downtown but said the Lady Luck was the only casino and only Las Vegas property for the company, which owns other commercial buildings in California. AMX officials could not be reached by press time.

Henry Brent Co. intends to halt the conversion of additional timeshares but will honor the ownership rights of those who have purchased units so far.

The Lady Luck has struggled under various owners in recent years and has tried several marketing strategies including affiliating with national hotel reservation systems.

Grossman said he is bullish on the Lady Luck's future downtown, which has an emerging cultural district in addition to several high-rise residential towers under development.

"The timing is great. Instead of one person trying to come in and doing something downtown you've got a lot of new owners coming in" and trying new things, he said.

Last year the company bought 3,500 square feet of business space across Third Street from the Lady Luck. The site of the former Trolley Stop casino, the frontage has been converted into a series of restaurants, bars and nightlife venues that will open in late June.

Those include the Hogs and Heifers bar, a slot bar called Cuba, a blues bar called Blue and a steakhouse called Triple George Grill. The company will open more attractions later this year along the single block of Third Street, which has been closed to traffic and transformed into a landscaped promenade.

Henry Brent Co. in 2003 received a two-year, limited license from regulators to operate the property because of concerns that the company -- new to casino management -- was thinly financed. Donner, who loaned money to the company, was initially prevented from being involved in the casino's management because he had made mistakes on his tax returns. Regulators are expected to vote on whether the company can receive a permanent casino license in September, Grossman said.


New casino plans leave Iowans with mixed reactions
As reported by DesMoinesRegister.com

RIVERSIDE, Iowa- Victory is sweet for Mayor Bill Poch of Riverside, a winner in Iowa's gambling license sweepstakes.

His city will reap millions of tax dollars from the glitzy $107 million Washington County Casino & Golf Resort, which is expected to open in early 2007.

"You'll have to search hard to find anybody who is negative about it," Poch said.

Few people are leaping for joy, though, in Kalona, a country town six miles west of here where it's common to see horse-drawn carriages with Amish farmers on the road. Many in Kalona opposed the casino plans before last week's approval by the Iowa Racing and Gaming Commission.

We're not exactly happy, because gambling can be a waste of money and we are not sure how it can better our community," said Betty Engel, who owns a natural foods store in Kalona. "But we want to think positive about it now. It could bring a lot of tourists in."

Mixed reactions to news that Riverside won a casino license aren't all that surprising. Washington County voters were fairly evenly divided last year on a referendum to authorize casino gambling. The proposal was approved by a 52-48 margin.

Similar feelings are being expressed in Wapello County, where not everyone was disappointed with the state's rejection of a proposed $40 million riverboat casino in Ottumwa. Wapello County voters had favored casino gambling by a 54-46 margin in an October 2003 election.

State regulators awarded licenses last week for casino projects in Waterloo, Emmetsburg and Worth County, as well. The commission denied casino license requests from Fort Dodge, Franklin County and competing bids from Waterloo and Emmetsburg.
In Riverside, a community of 928 people south of Iowa City, Mayor Poch is only thinking positive in the aftermath of last week's events.

Poch gives a thumbs-up as he talks about the 850 jobs that will be created by his town's riverboat casino and championship golf course. The city will net nearly $2 million a year from the resort complex, more than double the city's existing budget of $900,000.

The launching of the casino boat along the Iowa River should help revitalize Riverside's mostly boarded-up business district, Poch said. He's hoping to attract shops selling ceramics, silversmith items, leather goods and antiques to some of the 1.5 million gamblers who are annually expected to visit the casino complex.

He also envisions a plan to capitalize on the city's claim to be the future birthplace of Star Trek Capt. James T. Kirk. One of the possibilities is a Star Trek museum.

"On University of Iowa football weekends, it's going to be wild around here," Poch said. "There is no way we aren't going to get several thousand people coming here. They'll come to the hotel on Friday night and do some gambling and I would imagine there would be tour buses to bring them back on Saturday evening to continue the festivities."

The Riverside casino will be owned 50 percent by local investors, 43.75 percent by Iowa's Catfish Bend Casino, and 6.25 percent by Kehl Management. The casino complex will be built on Iowa Highway 22, about 11/2 miles east of U.S. Highway 218.

In Wapello County, Ottumwa community leaders were unhappy the riverboat casino proposed by Wild Rose Entertainment did not receive one of the coveted gambling licenses. The Wild Rose application received two votes from the five-member Racing and Gaming Commission, one short of approval.

Wapello County Supervisor Steve Siegel said after the commission's action he was trying to determine how to sway one more commissioner before a moratorium on additional licenses is considered in July.

On Saturday, Gov. Tom Vilsack said he wants gaming commissioners to reconsider Ottumwa. Commissioners balked, but Vilsack said Ottumwa was in need of a boost and "people relied on (the casino license) to push them through."

"The economy here is very bad," Short said. "We have too many McDonald's and Wal-Mart jobs and those that aren't paying anything."

Back in Riverside, the future looks bright, predicted Dan Kehl, chief executive officer of the Washington County Casino & Golf Resort.

The plans include 1,100 slot machines, 30 table games, a 200-room hotel, a 1,200-seat showroom, a recreational-vehicle park and an 18-hole golf course designed by Rees Jones Inc. The complex, which is now farmland, is expected to generate annual gross gambling revenues of between $85 million and $92 million.

Paul Laroche, who manages Riverside Grain and Feed Co., said the casino won't have much impact on his business, because he deals almost strictly with farmers.

"But overall for the town, it's definitely going to bring in a lot more money," Laroche said. "We have lost some businesses in Washington County and we definitely need something."


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