Issue 275
December 19 - December 25, 2005
Volume 5
page 1

This Issue

Gaming News

Trump's A.C. casinos to receive $110M. face lift

South Coast is in a hot spot: Population growth fuels local casino boom

Casinos set to return on Mississippi Gulf Coast

Tribeca Tables and Bowmans complete poker deal

Internet gambling at colleges 'verging on crisis'

Show Time The Boogie Wonder Band will be at Ceasars Palace in Atlantic City.

Column Man with a Plan By Barney Vinson

Check out our entertainment highlights & upcoming tournaments

See the lucky winners


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Trump's A.C. casinos to receive $110M. face lift

As reported by Press of Atlantic City

ATLANTIC CITY, New Jersey - Last year, Donald Trump's casinos were out of luck and nearly out of money.

Chapter 11 followed, but instead of destroying the cash-poor company, the bankruptcy reorganization allowed Trump to shed hundreds of millions of dollars of debt and tap new funding for expansion and renovation projects.

In the first phase of its post-bankruptcy rebuilding plan, Trump Entertainment Resorts Inc. announced Wednesday it will spend $110 million to give its three aging gambling halls a makeover.

"There won't be any product like it in Atlantic City. When we get done, it will be beautiful," Trump said in an interview from his New York office.

Trump, who is chairman of the company bearing his name, now has the money to back up his boasts. The bankruptcy reorganization cut $100 million from the company's annual debt payments and included a new $500 million line of credit. An extra $253 million will come from the recent sale of Trump's riverboat casino in Gary, Ind.

"The company is very strong financially," Trump said. "It came out of bankruptcy really well and really powerful. We have tremendous lines of credit and terrific cash flow."

The first phase of the renovation plan will include projects in 2006 and 2007. The company is still discussing the total cost of the rebuilding program, including the price tag for a new hotel tower scheduled to open in 2008 at Trump Taj Mahal Casino Resort.

"We haven't really determined it. But the word is, whatever is necessary," Trump said of the construction costs.

Trump Entertainment already has refurbished many of the hotel rooms at the three casinos and will now give the public areas of the buildings a facelift - in the process, adding some of the excitement and pizzazz needed to attract fickle gamblers.

"The renovations include a variety of projects designed to enhance the inherent strengths of each of the three properties," said James B. Perry, Trump Entertainment's chief executive officer. "Our goal is to focus on what matters most to our customers, and to create unique and exciting venues designed to add value to their Trump Atlantic City experience."

Trump Entertainment must spruce up its casinos to keep pace with its competitors on the Boardwalk and in the Marina District. Borgata Hotel Casino & Spa has started construction on a $525 million expansion project and Harrah's Atlantic City has plans for a $550 million makeover.

At the flagship Taj Mahal, renovations will include transforming a corridor that leads from the parking garage into a promenade featuring new stores and restaurants. A new high-end Asian gaming area, noodle bar and casino lounge also are planned.

Trump Plaza Hotel and Casino's outdated Boardwalk entrance will be given a facelift, complemented by changes to the lobby area to make it more accessible. The New Yorker deli will be replaced by a new restaurant.

When combined with Trump Plaza's newly added Liquid Bar and EVO Restaurant, the first floor from the Boardwalk entrance to the hotel lobby will have a more exciting and contemporary look, Perry said.

Trump Marina Hotel Casino will undergo renovations to its meeting and convention space. A new restaurant also is planned.

To boost morale among its workforce, the company has budgeted money for new staff uniforms at all three casinos and improvements to the employee cafeterias.

In addition to the $110 million rebuilding plan for 2006 and 2007, Trump Entertainment already has spent $32 million for renovation projects this year. By the middle of 2006, the company will have completely updated the standard guest rooms at all three properties and refurbished the casino floor at Trump Plaza, Perry said.

The centerpiece of the renovation program is a previously announced 800-room hotel tower at the Taj Mahal. Construction is scheduled to start next June, with completion in 2008.

Trump said the cost of the tower is still being determined. Designs have not yet been unveiled, but Trump promised the project will add a stunning new dimension to the Taj Mahal's skyline.

"It's going to be a really beautiful tower," he said.

At the same time it is refurbishing the Atlantic City casinos, Trump Entertainment is scouting expansion opportunities in other gaming markets. The company recently announced it will seek a gaming license for a new slots parlor in Philadelphia when Pennsylvania introduces casino-style gambling in 2006 or 2007.

Trump Entertainment replaced the now-defunct Trump Hotels & Casino Resorts Inc. when the company emerged from Chapter 11 bankruptcy protection in May. Trump's casino empire was threatened by a crushing $1.8 billion debt when it filed for Chapter 11 in November 2004, but the company's financial turnaround included a profitable third quarter this year.

South Coast is in a hot spot: Population growth fuels locals casino boom

As reported by Las Vegas Sun

LAS VEGAS, Nevada - Ground zero in the looming battle between locals casino powerhouses Station Casinos and Boyd Gaming Corp. is about halfway between Green Valley Ranch Station Casino and the South Coast.

Television commercials, billboards, newspaper ads and mailers are the weapons being used to poach and protect coveted casino customers, but neither company thinks the competition is a win-lose proposition.

Boyd Gaming's Coast Casinos subsidiary is opening South Coast on Dec. 22, raising investor concerns about whether the property will steal business from nearby casinos such as the Green Valley Ranch Station.

The South Coast, southwest of Las Vegas and Silverado Ranch boulevards, is about five miles west of Green Valley Ranch Station.

But Station isn't worried about the newest kid on the block. In fact, the company is all but welcoming its toughest competitor to the southern valley.

"Boyd is a terrific company and a very strong competitor," Station Chief Financial Officer Glenn Christenson said. "You have to give them the benefit of the doubt. They've been building casinos for years ... I have no doubt they'll be able to fill those rooms."

While South Coast expects to fill its 660 rooms with both drive-in customers and people flying into town for special events and meetings, many of its casino customers will be cultivated from the surrounding area that is growing by leaps and bounds.

By Boyd's estimate, the population within a five-mile radius of the South Coast has grown more than 70 percent since 2000 to an estimated 300,000 people.

And according to Las Vegas research firm Applied Analysis, the three miles surrounding South Coast represents one of the fastest growing areas of the valley when compared with growth surrounding other major locals casinos such as Green Valley Ranch Station, Suncoast and the under-construction Red Rock Resort.

From 1990 through 2000, the population within three miles of South Coast -- largely open desert until recent years -- grew by 667 percent. Through 2010, the population is expected to grow by 37 percent around the South Coast, compared with 29 percent for Green Valley Ranch Station and 30 percent for Red Rock.

Early success in booking events at the South Coast's equestrian and meeting centers prompted Boyd to accelerate construction of a second hotel tower that is expected to open by June, bringing the number of rooms to 1,300. That would be one of the largest off-Strip hotels in town, not far below the Orleans' 1,800 rooms. The Orleans is a sister Coast property.

The differences between a Station property and a Coast property aren't dramatic, Christenson said. "These are two very strong companies competing in this market. Both of us compete strongly every day."

Customers have been "voting with their feet for some time," he said. "Over time the market will continue to grow and both Station and Boyd will continue to be very successful."

The same growth theory is driving the Silverton, the closest major casino to South Coast, to undergo that property's biggest expansion effort. The Silverton, on Blue Diamond Road just west of Interstate 15, is just over three miles from the South Coast.

Over the next few months, the Silverton will spend tens of millions of dollars building up to four restaurants, a spa, gym, new pool, 400-room hotel tower, convention center, lounge, a bigger casino and an ampitheater-style entertainment venue.

Two restaurants will be complete by April when the rest of the upgrades will begin construction. The tower and the other additions are scheduled to open by mid-2007. In the future, the Silverton envisions creating a bigger resort community with an on-site second resort, timeshares, hotels and a shopping mall.

The Silverton is responding to the region's population growth rather than to the opening of South Coast, Silverton President Craig Cavileer said. The South Coast will compete with the Silverton, but will also attract more attention to the growing South Strip region, he said.

"It really just expands the market," he said. "We're really the only destination property out here now. The market has proven that there are a lot of customers that enjoy the experience of Las Vegas but prefer not to stay right on the Strip. They really want to settle into a more comfortable environment than on the 48th floor of a 5,000-room hotel."

The competition is expected to grow dramatically along Las Vegas Boulevard South in the years to come. Station owns 55 acres of land just south of the South Coast where it expects to build a casino someday. And developers Garry Goett and Anthony Marnell III plan their own competing casino resorts farther south.

South Coast is about eight miles south of the company's existing Orleans and Gold Coast casinos.

The Orleans in particular has customers who live at the southern end of the valley who will now have a much shorter drive to a Coast property with the opening of South Coast, Boyd spokesman Rob Stillwell said.

Cannibalization of the Orleans' business isn't a concern, nor is the South Coast depending on any existing Coast customers flocking to the new property, Stillwell said.

"The population growth at the southern end of the valley has been tremendous," he said. "The equestrian center and the large number of timeshares being built in the area present tremendous potential for new customers."

South Coast will steal some business from Green Valley Ranch Station, although the population is growing at such a strong clip that these and future suburban casinos will likely absorb the competition, Bear Stearns stock analyst Joe Greff said.

When Green Valley Ranch Station opened in December 2001, revenue was clipped by 15 percent to 20 percent as customers gravitated from the Sunset Station and Fiesta Henderson properties, he said.

The cannibalization of business was much lower than the 50 percent that company executives had predicted before Green Valley Ranch Station opened.

Revenue from neighborhood casinos in Las Vegas has grown by more than 10 percent this year and is expected to be strong in the coming years as billions of dollars' worth of hotel projects take shape on the Strip by the end of the decade, stimulating jobs and population growth, Greff said.

"About 5,000 to 7,000 people continue to move to Las Vegas each month," Greff said. "Surprisingly, this hasn't slowed down over the last few years."

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