Although rural Nevada casinos lost market share to urban areas in May’s revenue report from the Nevada Gaming Control Board, as the Business Press reported last week, slot-route operators are bullish on the boonies. Latest evidence of this is Golden Gaming’s’s acquisition of Pahrump Nugget Hotel & Gambling Hall.
The buy gives Golden Gaming 38 acres in bustling downtown Pahrump, not to mention 553 slots and 10 table games. Golden owns a 200-location slot route in Nevada, not to mention 43 taverns, including the PT’s Pub brand. Although it has three brick-and-mortar casinos in Black Hawk, Colo., the Pahrump Nugget will be Golden’s first full-fledged casino in Nevada. It obtained the property, for an undisclosed price, from William Richardson and two scions of the Ensign family, notable for its longtime affiliation with the erstwhile Circus Circus Enterprises.
Three weeks ago, Herbst Gaming plunked down $148 million for the four casino assets of Sands Regent. The deal grows Herbst’s casino portfolio by 50 percent, adding four Nevada casinos to the four it already owns, not to mention an additional four scattered across the Upper Midwest. By making this move, Herbst will now be in Dayton, Sparks and Verdi, not to mention obtaining the Sands Regency Casino Hotel in downtown Reno.
Herbst’s investment in the outstate and Reno markets affirms the unflagging optimism of Sands Regent CEO Ferenc Szony. The ebullient Szony has managed to keep the flagship property hanging in there, despite an outdated physical plant and a decaying casino corridor in downtown Reno. Although several venerable properties, such as the Comstock and Sundowner, have bitten the Reno dust over the past decade, Szony has kept the Sands Regency’s doors open.
For an indicator of how much Herbst values the rural market, shares of Sands Regent went for $15/share. That’s as much as Riviera Holdings CEO William Westerman was paid for his chunk of Riviera — which includes a Strip casino.
Case Bets: Speaking of Riviera … a recent, truncated item in the print edition of the Las Vegas Business Press tried to explain how the Riviera Black Hawk figures into the machinations surrounding the sale of Riviera Holdings. Barry Sternlicht, Brett Torino, Neil Bluhm and other members of the potential new-ownership group still have to scare up $95 million to bridge a gap in their financing.
The Black Hawk casino-hotel is said to be unencumbered and Riviera fielded $100 million-plus offers for that property alone, when the company was being shopped around last summer. So Sternlicht & Co. close the Riviera purchase, liquidate Riviera Black Hawk (probably to Isle of Capri Casinos, I hear), cover their financing shortfall and probably have a few million left over — giving them a Strip casino for no money down. A smooth move, if they can swing it.
