President Biden Still Committed to Ridding Hospitality, Travel Industries of Junk Fees

President Joe Biden’s days in office are numbered, but the leader of the free world says he remains committed to freeing the travel and hospitality industries of junk and resort fees.

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Charlotte Douglas International Airport workers vote to go on strike on Friday, Nov. 22, 2024. President Joe Biden says he still wants to eliminate junk fees from the travel industry before he departs The White House in January 2025. (Image: WSOC)

Biden refers to junk and resort fees as those pesky add-on charges that come toward the end of the online booking process. Such add-ons allow an airline or casino hotel to advertise a cheaper rate on a booking search engine than the actual true price of the flight or stay.

Biden has routinely spoken out against the charging process that he believes is deceptive to consumers. With Thanksgiving week here — the busiest travel holiday in the United States — Biden says his administration continues to work to eradicate junk fees from the travel industry.

Travel to your loved ones this Thanksgiving with the peace of mind that my Administration is fighting to ban airline junk fees, requiring automatic refunds, and ensuring that airlines cover hotels and meals for cancelations and delays,” Biden tweeted.

Earlier this year, the US Department of Transportation (DOT) updated its pricing regulations to require commercial airlines to disclose all costs and possible add-on fees upfront at the beginning of the consumer’s booking process. The US airline industry continues to challenge the pricing change in federal court.

Hotel Comps

Biden’s support of requiring airlines to cover a ticketed passenger’s hotel and meal costs when a flight is canceled or delayed comes as concerns emerge out of Charlotte’s Douglas International Airport. Airport workers there went on strike on Monday as the Thanksgiving holiday travel week takes off.

Employees at the Charlotte airport — one of the nation’s busiest — who clean airplanes, remove trash, and assist with wheelchairs, walked off the job Monday morning. Officials with the Service Employees International Union say the strike is expected to last only 24 hours, but the labor stoppage will likely still impact travel today and on Tuesday. With CLT being a hub for American Airlines, that airline is to be most impacted.

Most airlines charge for bags, seats, and some on-board amenities. Biden thinks the airlines should be charged when they inconvenience passengers.

Biden junk resort fee airplane casino resort
(Image: X)

Biden’s support of ridding junk fees from the airline industry and forcing them to cover hotel stays for interrupted itineraries is presumably popular with the general public and could be a rare piece of bipartisan legislation in Congress. But the powerful airline lobby has so far kept Congress grounded in passing a law to force such changes.

The airline lobby is also investing considerable resources in defending the industry’s pricing in the wake of the DOT’s proposed rule change.

Airlines for America says requiring airlines to include all possible add-on fees up front would “greatly confuse consumers” who might think they’ll need to spend more than they actually would if they have airline status, don’t check a bag, or don’t need to change a reservation after booking.  

Casino Resort Fees

Like the airlines, most casino resorts add a charge to a guestroom toward or at the end of an online booking. On the Las Vegas Strip, the nightly charges are as high as $50 a night before tax.

For a Friday to Sunday stay this weekend at Caesars Palace, the Caesars.com website advertises an average nightly rate of $259. After clicking through, however, that nightly rate balloons to $350.29 after a total resort fee of $99.90 and taxes of $82.68 are tallied.

The $49.95 daily resort fee at Caesars Palace includes high-speed Wi-Fi for two devices per room, fitness center access, and local calling.

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Live! Casino Pittsburgh Celebrates Four Years With New Amenities, High-Limit Room

Live! Casino Pittsburgh in the city suburb of Westmoreland celebrated four years last week by introducing new amenities and opening a high-limit gaming lounge.

Live! Casino Pittsburgh high-limit room table games
Live! Casino Pittsburgh has opened a new high-limit table gaming room. The space for high rollers comes as the Pennsylvania satellite casino celebrates four years in business. (Image: Casino.org)

One of four so-called “mini-casinos” in Pennsylvania, Live! Pittsburgh was the first Category 4 satellite gaming property to open. After Baltimore-based Cordish Companies invested $150 million to transform a former Bon-Ton department store at the Westmoreland Mall into a casino, the first bets were wagered in October 2020 as concerns about the COVID-19 pandemic raged on.

Four years later, Cordish officials say the company’s big bet on Pennsylvania, highlighted by its $700 million investment to open Live! Casino & Hotel Philadelphia, a full-scale casino that allowed Cordish to pursue a satellite gaming venue in Pittsburgh, is paying off. Live! Pittsburgh is the top-performing mini-casino in the commonwealth, with its 2023 gross gaming revenue (GGR) totaling $131.6 million.

To celebrate, Live! Casino Pittsburgh has upgraded the casino after fielding customer feedback this summer.

Casino Upgrades 

In July, Live! Casino Pittsburgh announced it would reconfigure its gaming floor to better satisfy patrons. Casino reps said the upstairs poker room would be relocated to the main first level where the casino’s slot machines and other table games are.

The former upstairs poker room, measuring 1,600 square feet, has since been converted into an events space called the Social Club. The room has a rustic lodge décor and is ideal for groups between 20 and 100 people. The space features a versatile layout with a full bar, fireplace, leather couches, and bucket chairs.

Downstairs, gamblers will find a new high-limit lounge and the relocated poker room. The space reserved for high rollers has three table games and a dedicated bar.

It’s incredible to think that we’ve been part of this community for four years and it just keeps getting better. I don’t think there could be a more appropriate way to celebrate than with these three exciting additions to our beautiful property,” said Sean Sullivan, general manager at Live! Casino Pittsburgh.

“These investments underscore our commitment to being a good community partner and world-class gaming and entertainment destination,” Sullivan added.

Sullivan said the property changes cost about $7.5 million.

Live! Pittsburgh Restrictions

Being a Cat. 4 casino, Live! Pittsburgh is limited to 750 slots, including other electronic gaming machines, and 40 table games. The three high-limit tables count against that number.

Pennsylvania’s 2017 gaming expansion package included regulations that limit mini-casinos to an initial allotment of 750 electronic gaming positions and 30 tables. After a year in operation, Cat. 4 properties can pay an additional $2.5 million fee to add 10 tables.

Live! Pittsburgh is the only Cat. 4 casino to have paid the $2.5 million add-on to increase its table privileges to 40.  

Despite having only 27 table games, Hollywood Casino York edged Live! Pittsburgh last year for the top-grossing satellite table property. Hollywood York won $16.6 million on its felt, compared to $16.3 million at Live! Pittsburgh.

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Wynn Could Have Lengthy UAE Casino Monopoly

Wynn Resorts’ Wynn Al Marjan Island integrated resort in the United Arab Emirates (UAE) is expected to open in early 2027, perhaps several months sooner, and when it does, the casino hotel will enjoy a potentially length monopoly in the emirates.

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General Commercial Gaming Regulatory Authority (GCGRA) Chairman Jim Murren. He said it will be awhile before the UAE adds more casinos. (Image: Bloomberg)

The reason for that advantage is because the General Commercial Gaming Regulatory Authority (GCGRA) — the UAE’s first gaming regulator — isn’t rushing the approval of additional casino licenses over the near-term.

The process is moving very deliberately here. The government has been very clear it wants a state-of-the-art, very compliant, very rigorous regulatory regime. Nothing we’re doing will rush that,” said GCGRA Chairman Jim Murren at the Skift Global Forum East 2024 earlier this week.

The GCGRA was formed in September 2023. It’s been about less than two months since the regulatory body approved a gaming license for Wynn Al Marjan Island, which is located in the emirate of Ras Al Khaimah, marking the first such approval in the history of the Arab world.

Pragmatic Approach in UAE Could Benefit Wynn

At the conference, Murren emphasized that a pragmatic approach to issuance of casino licenses is “incredibly important” to the UAE government, adding that the GCGRA is focused on the operators to which it’s granted permits.

That’s Wynn and a lottery operator in Abh Dhabi, indicating that while Wynn won’t have a permanent monopoly in the emirates, it will enjoy a significant head start over any competitors looking to enter the market. Those include MGM Resorts International, the company Murren previously led.

“We’ll see other integrated resorts in the UAE over the next five to 10 years, but Wynn has the head start,” said Murren.

He didn’t get into specifics, but it appears will Wynn’s UAE monopoly will span at least several years.

Earlier this year, MGM confirmed it would like to pursue a UAE gaming license and that there is space for a casino set aside at its hotel in Dubai, which is currently structured as a non-gaming venue. Owing to its status as the region’s prime tourist destination and the vast petroleum wealth possessed by some locals, the UAE is compelling market for gaming operators, implying new licenses are worth waiting several years for.

Long-Term UAE Casino Outlook

Though he drew comparisons between the UAE today and Las Vegas 30 years ago, Murren didn’t get into the exact amount of gaming venues that could eventually call the emirates the home. What is clear is that the number will never be comparable to that of Las Vegas or Macau and that analysts and executives largely view UAE as a four casino market, including Wynn Al Marjan Island.

Four integrated resorts could be enough to make the emirates a $3 billion to $5 billion market in terms of annual gross gaming revenue (GGR) and potentially rank it fourth in the world behind only Macau, Nevada, and Singapore.

Some analysts estimate UAE’s total addressable gaming market could be as high as $8.5 billion, but that figure implies going beyond four casino resorts and more liberalized views toward gaming in the countries closest to the emirates.

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Wynn NYC Casino Opposition Groups Surpasses 5,000 Supporters

“Protect the High Line,” the group opposing the plan by Related Cos. and Wynn Resorts to build a casino hotel on Manhattan’s West Side, said its ranks have swelled to over 5,000.

High Line
Part of the High Line area of New York City. “Protect the High Line,” a casino opposition group, says it has more than 5,000 members. (Image: NPR)

The group, which is named for the iconic park it’s seeking to protect, is about five months old, indicating it’s quickly cobbled together support to protect the High Line. That fortification also amounts to opposition to the proposed $12 billion investment in the Western Rail Yards that Related is pitching. Wynn New York would be the centerpiece of that development, assuming it procures one of three downstate casino licenses that have yet to be awarded.

The overwhelming support of 5,000 voices reflects the deep and broad community resistance to this plan,” said Alan van Capelle, executive director of Friends of the High Line, in a statement. “People from all walks of life are united in rejecting proposals that threaten the High Line’s unique character and fail to uphold the values of community input in how our neighborhood grows.”

Van Capelle added that support for the group’s efforts has grown and backers hail from all over New York City — not just the High Line area.

Heart of Opposition to Wynn NYC Casino

Protect the High Line’s opposition to the Related/Wynn casino project largely boils down to two issues. First, the group is concerned that the proposed towers, including one that would bear the Wynn name, would block views of the High Line.

Second, the group argues that Related isn’t following through on a 2009 agreement the developer struck with the city. Under the terms of that accord, the real estate firm would have built 3,454 to 5,700 housing units on the site, but the proposal featuring the casino plan calls for just 1,500 units. Some critics of the casino plan believe the 2009 agreement was a best-of-both-worlds proposal because it allotted for more housing without threatening the High Line’s iconic views.

“The Protect the High Line campaign advocates for development that respects the 2009 rezoning agreement, preserves the park’s integrity, and prioritizes public benefit, including commitments to affordable housing,” said the group in the Thursday press release. “Moving forward, the campaign will continue to engage stakeholders, amplify community voices, and push for a planning process that centers the needs of the public.”

Protect the High Line recently commissioned polling on the issue and the results indicate that a majority of West Side residents don’t want a casino in the neighborhood.

Wynn NYC Casino Has Supporters, Too

As is the case with nearly all of the New York City-area casino proposals, the Related/Wynn project has detractors and supporters.

While community groups and local politicians are firmly against the gaming venue, some supporters believe it would be an important revenue generator in terms of helping the homeless in the area. Additionally, labor groups see an opportunity for substantial job creation.

Earlier this year, Related cautioned that if the casino component is removed, it’s unlikely to move forward with a major development at the Western Rail Yards.

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Fairfax County Officials Say No NoVA Casino in Affluent Northern Virginia

Local officials in Northern Virginia’s Fairfax County continue to speak out against efforts to bring a Las Vegas-style casino, resort, and convention center to Tysons.

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The Fairfax County Board of Supervisors is asking area residents for input regarding the possibility of Tysons being designated for a casino resort and convention facility. Much of the public is opposed. (Image: ABC7)

The Fairfax County Board of Supervisors met Tuesday night and welcomed public input on the casino matter. Much of the feedback from area residents and township leaders expressed strong hostility to slot machines and table games.

Join us in saying no. There are too many negatives [associated with a casino],” Vienna Mayor Linda Colbert said.

Vienna borders Tysons, where state Sen. David Marsden (D-Fairfax) wants to put a casino resort and convention complex.

“We do not want a casino,” added William Comerfield, a 46-year resident of Vienna, as reported by FFXNow, the definitive local news source for Fairfax County.

We already have enough problems in Tyson. We don’t need a casino,” said William Doolittle, president of The Rotonda Homeowners’ Association in McClean, another border town to Tysons.

Even if Marsden’s casino bill passes next year and is signed by Gov. Glenn Youngkin (R), a casino would only be allowed after voters approve the project through a local referendum.

Casino Bill Expected

Marsden is expected to file another casino bill, as he did this year before the statute died in committee, seeking to amend Virginia’s casino law to include Fairfax County — specifically, Tysons — as a qualified host for a casino establishment. Currently, only Norfolk, Bristol, Danville, Portsmouth, and Petersburg are allowed to host slot machines, table games, and sportsbooks.

Marsden says Fairfax residents will see their property taxes further increase in the coming years as the many corporations that call the county home rework their office building leases. Though several of the Fortune 500 companies that are based in, or have a large presence in Fairfax’s McClean, Tysons, Reston, and Vienna — including Capital One, Hilton Worldwide, Freddie Mac, and Booz Allen Hamilton — have forced employees to return to the office, many continue to allow for flex workweeks and some work-from-home opportunities.

Companies are leasing less space than they did before the pandemic, and that will likely lead to office buildings fielding lower assessed valuations, which in turn lessen their property tax liability.

Commercial real estate advisory Newmark wrote in its third quarter report for Northern Virginia that net absorption for the region totaled negative 714K square feet during the three months. The negative absorption was spread out across the region’s cities.

Fewer landlords have capital for concessions, which have been a major driver in attracting tenants over the past several years,” the Newmark note on Northern Virginia’s Q3 read. “The pool of landlords that can pay for tenant improvements is shrinking. There are fewer owners offering trophy office space, fostering an unusual landlord-favorable environment for the highest quality space. Meanwhile, conditions continue to soften in Class B and C assets.”

Marsden says a casino resort and convention center is an option Fairfax residents should consider as a solution to help offset presumptive tax increases in the future.

Some in Support

Though most residents have opposed Marsden’s casino push, many unions in the region have come out in support of the undertaking. Union leaders and members say a resort casino and convention hall would create thousands of construction and permanent jobs, providing opportunities for blue-collar workers to earn a sustainable living wage in the affluent area.

“Union jobs give higher pay, pensions, and dignity,” said Epaminondas Mouhanis, a board member of the International Brotherhood of Electrical Workers, Local Union 26. “Please stand with the working class.”


Correction: An earlier version of this article listed former Gov. Ralph Northam as the current governor. The article has been updated to reflect the error.

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Wynn Says UAE Casino Hotel is More Than Half Complete

Wynn Resorts (NASDAQ: WYNN) announced Thursday that as measured on the basis of structural concrete, its Al Marjan Island casino resort in the United Arab Emirates (UAE) is 55% complete.

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A rendering of Wynn’s UAE casino hotel. Construction there is more than half complete. (Image: 11 Prop/YouTube)

Wynn Al Marjan Island is located in the emirate of Ras Al Khaimah. While concrete construction is complete up to the venue’s 26th floor, walls extend up to the 29th. Construction crews are finishing one floor per week and in just the past 100 days, the hotel tower has grown in height by 100 meters. The goal is to have that tower topped off by December 2025.

The resort will offer 1,542 rooms and well-appointed suites. To date, the tower structure has been completed for 1,121 guest rooms, or 73% of the total,” according to a statement issued by the gaming company. “Fit out is underway in approximately 820 rooms — including walls, floors, and ceilings, as well as all mechanical, electrical, and plumbing services. The elevator and escalator installation also began this month.”

There are 9,100 construction workers on site daily, and more than 100 concrete trucks delivering payloads to the property.

Wynn UAE Casino Headlines Recently Positive

News that construction on Wynn Al Marjan Island is progressing rapidly arrived just weeks after the General Commercial Gaming Regulatory Authority (GCGRA) granted the gaming license for the Wynn venue.

That marked the first such approval in the history of the Arab world, signaling that the UAE could be the beacon of gaming liberalization in the region. Specific to Wynn, while analysts widely expect the UAE will eventually be a multicasino market, it’s also clear that Wynn Al Marjan Island will be the only gaming property there for several years, giving it the advantages of a temporary monopoly.

One of the primary reasons Wynn and UAE are a good match is because regulators there don’t want the casino to be the focal point of the integrated resort. Wynn operates its venues so that dining, entertainment, and other amenities take precedence over gaming, and the casino space at the UAE venue is expected to command just 4% of the total square footage.

“The resort will also include a 15,000-square-meter shopping promenade filled with the world’s top luxury boutiques, a five-star spa, and a salon. The 7,500-square-meter meetings and events center, along with a theater, will offer exciting parties, events, and bespoke entertainment experiences,” according to the statement.

Wynn Could Usher in New Era in the UAE

Countries in the Middle East have long opposed wagering in nearly all its forms, but the UAE is showing signs of leading liberalization on that front. Before approving Wynn’s casino license, regulators there signed off on a lottery permit for a company looking to operate in Abu Dhabi.

By some estimates, when the casino market in the UAE fully matures, it could be the fourth-largest in the world, and that would be with contributions from no more than four venues producing as much as $5 billion in annual gross gaming revenue (GGR).

The UAE’s location could also help bolster its ascent in the global casino ranks. Specific to the Wynn property, it’s located within an eight-hour flight of 96% of the world’s population.

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Commercial Gaming Revenue Tops $17.7B in Third Quarter of 2024

Commercial gaming revenue during the third quarter of the year reached $17.71 billion, as the sports betting and iGaming segments continue to expand.

commercial gaming revenue AGA casino
The US commercial gaming industry, led by Nevada and the Las Vegas strip (pictured), continues to increase overall revenue. The improvement in the third quarter was fueled by iGaming and sports betting. (Image: Getty)

The American Gaming Association (AGA) reported Thursday that gamblers lost more money than ever before during the July through September stretch. The $17.71 billion represented an 8.1% year-over-year increase. Q3 also marked the commercial gaming industry’s 15th consecutive quarter of year-over-year growth.

That’s the good. Now, the bad.

While total gaming revenue continued to swell, things weren’t so great for legacy gaming interests or brick-and-mortar gaming. The AGA report revealed that casino revenue from in-person gamblers was down almost 1% to $12.38 billion.

“Traditional brick-and-mortar casino gaming revenue contracted annually by less than 1% in the third quarter, with slot machines and table games generating $12.38 billion in revenue. Brick-and-mortar revenue decreased year over year in two of the three months in Q3, only rising in August,” the AGA summary read.

Table games were responsible for the legacy decline, as slot win was up 1.3% to $9.1 billion. Table hold nationwide was just 20%, the fourth straight quarterly decline. Felt GGR dropped 8.3% during the quarter to $2.42 billion.

The remaining $860 million in legacy revenue came from retail sportsbooks, poker rooms, and other casino gaming like bingo.

(Image: American Gaming Association)

iGaming, Online Sports Betting Growth

Retail casino losses at the tables were easily offset online, where internet casinos and mobile sportsbooks continued to see revenue blossom.

During the three months, regulated online casino gaming in Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia soared 30% to $2.08 billion. Sportsbook revenue totaled $3.24 billion, up 42% from Q3 last year.

Through three quarters, iGaming revenue in just seven states totaled more than $6 billion, up 27.2%. That’s 16.2% of the $37.2 billion that physical casinos won in 27 commercial casino gaming states. Rhode Island became the seventh iGaming state when its Bally’s Casino online platform went live in March.

Each of the six iGaming states with 2023 comparisons grew year over year in the third quarter, led by 393% growth in Delaware powered by the Delaware Lottery’s new iGaming partner Rush Street Interactive. Each of the other five pre-existing iGaming markets posted annualized quarterly growth of 25-68%,” the AGA said.

Sports bettors through nine months lost $9.96 billion, 33.6% more than they did at this point last year. The $9.96 billion marks a new sports betting revenue record for the third quarter, as the market begins to settle after no new states launched sports betting this year.

Missouri is expected to become the 39th legal sports gambling state next year after state voters approved sports betting through a statewide ballot referendum during the November 5 election.

Market Outlook

With nine months in the bag for 2024, all commercial gaming segments are positive, as traditional casino GGR remains up 0.4% despite a difficult third quarter. Though some Americans are pulling back their leisure spending as inflation has continued to keep the costs of everyday goods elevated, the gaming industry continues to experience growth.

“Through the first nine months of the year, nationwide commercial gaming revenue stands at $53.24 billion, pacing 8.0 percent ahead of 2023 and putting the industry on track for a fourth straight record revenue year,” the AGA concluded.

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Pennsylvania Casino Revenue Stagnates, iGaming Continues Upwards Run

Pennsylvania casino revenue from in-person slot machines and table games totaled approximately $274.5 million in October 2024, a negligible 0.2% year-over-year gain.

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A blackjack dealer at Rivers Casino Pittsburgh. Pennsylvania casino revenue from retail slots and table games totaled $274.5 million in October 2024. (Image: Pittsburgh Post-Gazette)

Pennsylvania’s 17 brick-and-mortar casinos combined to win $200.6 million from their slots and $73.9 million from their tables. Slots managed to offset a more than 9% year-over-year decline on the felt, as the one-armed bandits increased their net win by over 4%.

Though last month marked only a negligible 0.2% improvement from October 2023, October 2024 returned the brick-and-mortar casino industry to growth after legacy GGR fell almost 2% in September. Pennsylvania’s casinos also remained stable, as casinos in Atlantic City saw in-person play slow by 8.5%.

Sportsbooks experienced a rough month, as October hold tumbled 43% as many Philadelphia Eagles and Pittsburgh Steelers bettors saw the spreads, moneylines, and over/unders go their way. Online poker and fantasy sports rake were also in the red, as those segments respectively saw revenue of $2.2 million and $2.21 million, down 6% and 21%.

iGaming Continues Growth

The segment declines were more than offset by iGaming such as online slots and interactive table games.

Online casinos won almost $140.8 million from slots and $46 million from tables for a combined win of approximately $186.8 million. The iGaming win represented a 22.5% surge from October 2023, a difference of more than $34.3 million.

Online casino gambling continues to attract both legacy gamblers and new players to the internet gaming platforms.

Penn Entertainment dominates the iGaming market in Pennsylvania, with the Hollywood casino operator accounting for $69.4 million of the October revenue. Boyd Gaming’s Valley Forge Casino Resort was a distant second at $51.9 million, and Rivers Casino was third at $33.2 million.

State Fines VGT Operators

The Pennsylvania Gaming Control Board (PGCB), which issued the October gaming revenue report on Wednesday, also provided an update on regulatory violations. The state gaming regulator said it approved consent agreements presented by the Board’s Office of Enforcement Counsel relating to two video gaming terminal operator licensees.

The PGCB signed off on a $37,500 fine against a TA Travel Center located at 7848 Linglestown Road in Harrisburg for allowing its VGT room to be open without a board-credentialed employee on site. State gaming laws require that VGT locations have board-certified employees working whenever their gaming machines are in operation.

The PGCB additionally fined the Love’s Travel Stops location, also in Harrisburg, at 1165 Harrisburg Pike, for a similar violation. The truck stop was issued a $32,500 penalty.

Seventeen People Banned

The public leaving minors in their vehicles while they gamble inside a casino continues to be a problem in the commonwealth.

The PGCB approved the placement of five individuals onto its Involuntary Exclusion Lists for leaving children unattended in their vehicles while gambling. One incident involved a male patron leaving an infant in a vehicle at Hollywood Casino Morgantown while the outside temperature was 91 degrees Fahrenheit while he made a bet at the casino’s sportsbook.

The Board also banned four individuals for committing fraud using iGaming sites

“The eight additional persons placed on the Casino Involuntary Exclusion List, whose presence in a licensed facility would be inimical to the interest of the Commonwealth and licensed gaming, were for various offenses,” the PGCB reported.

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Las Vegas Locals Casino Market Masking Weaknesses, Says Analyst

On the surface, the Las Vegas locals’ gaming market appears solid. Year to date, gross gaming revenue (GGR) is up 6%, which has prompted sell-side analysts to wax bullish on Boyd Gaming (NYSE: BYD) and Red Rock Resorts (NASDAQ: RRR), but at least one analyst says forecasts may be too rosy.

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Boyd Gaming’s Suncoast Casino Hotel. An analyst says Wall Street is too enthusiastic about Las Vegas locals stocks. (Image: Boyd Gaming)

Deutsche Bank’s Carlo Santarelli departs from his colleagues’ positivity on stocks tethered to the Las Vegas locals segment. In a recent note to clients, he pointed out that nearly all of that 6% topline growth is attributable to Red Rock’s Durango Casino & Resort in Southwest Las Vegas, which opened in December 2023. Strip out that property, and Las Vegas locals GGR is actually down 3% in 2024, he said.

Santarelli added that Durgano has cannibalized Red Rock Resort in Summerlin and some of the operator’s other casinos, which “has offset the favorable margin profile of Durango.”

Red Rock executives addressed the issue earlier this year, noting that cannibalization isn’t expected to be a long-term hurdle. In May, CFO Stephen Cootey said on the company’s first-quarter earnings conference call that population growth across the Las Vegas Valley can offset some of the lost business that Durango has taken from other Red Rock venues. There’s credibility in that statement because the operator’s planned new casino hotels in the area aren’t close to Durango.

Restrained Outlook on Boyd

Boyd Gaming is another example of an operator with Las Vegas locals exposure that Santarelli believes Wall Street is too hyped up about. To be fair, nine of the 16 analysts covering Boyd rate it the equivalent of a “hold,” and unlike Red Rock, Boyd has geographic diversification.

Wall Street is constructive on Boyd due in part to the operator’s Las Vegas footprint and new projects, but Santarelli believes the sell side’s assumption that Boyd will shift from stalled to positive revenue growth ignores cracks in regional gaming markets.

Perhaps we are being conservative, but given the trajectory of the market, much like regional markets prior, which remain challenged, we don’t see the pivot and resumption of same-store growth occurring in 2025,” noted Santarelli.

He estimates that Boyd’s revenue and cash flow will drop 1.5% and 3.3%, respectively, next year.

Wary on Red Rock Estimates, Too

As Santarelli pointed out, Red Rock is an example of a Las Vegas locals stock on which analysts may be too bullish. Nine of the 14 analysts who cover it rate it “buy” or “strong buy,” but that belies the possibility the operator’s cash flow and revenue will slightly decline next year.

This one is particularly curious in our view, given the relatively detailed color from management on the 3Q24 call, as well as the aforementioned underlying market dynamics,” wrote Santarelli.

He added that Red Rock would likely need to grow 2025 cash flow at a rate that currently looks hard to achieve to combat the effects of planned spending, including future Durango expansion.

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Reno’s J Resort Announces Additional $130M Investment, Total Project Now Over $550M

Colorado-based Jacobs Entertainment, the company behind the redevelopment and rebranding of the Sands Regency to the J Resort in Reno, Nev., continues to live up to its pre-project promises.

J Resort Reno casino investment
The J Resort is set for further investment following its $300 million renovation and rebranding. Parent company Jacobs Entertainment has put aside another $130 million for the destination. (Image: J Resort)

Jacobs Entertainment spent $300 million to overhaul the former Sands Regency. The new property debuted as J Resort last spring, with the investment renovating all 750 hotel guestrooms, remodeling the casino floor, and adding over 1,000 surface parking spaces.

The resort additionally brought in new restaurants, including Hannah’s Table and J Paul’s Italian Steakhouse, plus a nightclub called Afterglow. A digital exterior wall measuring 65 feet displays artwork curated from around the world.

This week, Jacobs Entertainment, controlled by founder and CEO Jeff Jacobs, confirmed to the Reno Gazette-Journal that the company will invest another $130 million to further improve the J Resort.

Reno Redo

Jacobs Entertainment acquired the Sands Regency in 2017 for $30 million. Two years later, the company announced an ambitious plan to inject $1 billion into Reno and bring “The Biggest Little City in the World” an innovative attraction called the Reno Neon Line.

Located along W. 4th Street from N. Arlington Ave. west to Vine St., Jacobs’s master plan includes a mixed-use hospitality, entertainment, art, and residential corridor. Of course, casino gambling is also in the mix.

Along with the J Resort casino featuring 400 slot machines, a dozen table games, and a sportsbook, Jacobs owns and operates Gold Dust West along 4th and Vine. Gold Dust offers 450 slots, video poker, and keno.

Jacobs spent more than $100 million in purchasing blighted motels and vacant buildings along and near his planned Reno Neon Line. He’s also committing another $130 million to further expand and update the J Resort.

We have over $400 million currently invested in downtown Reno. With the additional $130 million to be spent, we will have invested close to $550 million,” Jacobs told the Reno Gazette-Journal.

The $130 million allocation will be used to construct two new event spaces and an exhibition hall where Jacobs will display his famed Ferrari collection. An indoor-outdoor pool atop the J Resort’s west tower and a full-service spa is also included.

Outside, $5 million of the budget is being set aside to build a concert and festival grounds space. The Glow Plaza, as it’s being billed, will be located across W. 3rd St. on what is currently a paved parking lot between Arlington and Ralston Streets. The music venue will be capable of hosting 15K people at a time. 

Reno Revenue

Reno’s casino industry has been soaring since the COVID-19 pandemic.

Gross gaming revenue (GGR) in Washoe County, home to Reno, totaled $865.7 million in 2018. GGR fell to $857.2 million in 2019 and to $676 million in 2020.

Pent-up demand led to a rally in 2021, as casino win topped $1 billion for the first time since 2007. County casino revenue stayed upwards of the $1 billion mark in both 2022 and 2023.

Jacobs isn’t the only one bullish on Reno and Northwest Nevada. The Meruelo Group, which owns the Grand Sierra Resort, is seeking to build a $400 million, 10,500-seat indoor arena in downtown Reno.

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