September 22, 2016 - 3:06 pm
Representatives of two locals casino companies are counting on new opportunities now that the Nevada Gaming Commission has unanimously approved licenses to Red Rock Resorts for the Palms and to Boyd Gaming for the Aliante Hotel.
The Nevada Gaming Commission on Thursday unanimously approved both matters, setting the stage for the Palms to become a Station Casinos property and Aliante to join the Boyd family within weeks.
For Station, a Red Rock subsidiary, the opportunity is having an off-Strip property that feels like it’s on the Strip with a plan to market it both to locals and tourists. For Boyd, it’s having a relatively new building in North Las Vegas. Boyd has never had a property there, but now 20,000 homes are being built in the area and 120,000 new jobs are on the horizon in the next five years with the arrival of Faraday Future, Hyperloop One and their affiliate companies.
Boyd will now have two casinos in North Las Vegas, the Aliante and, pending regulatory approval, the Cannery.
The Palms has 15 food outlets, the 2,500-seat Pearl Theater performance hall, a 14-screen Brenden Theatres and IMAX movieplex, a 2-acre pool and 60,000 square feet of meeting and convention space.
Chief Financial Officer Marc Falcone told commissioners his company acquired the property at 53 percent of its original construction cost, but that cash flow is 60 percent below its peak level.
The company is financing the acquisition from investment bankers TPG Capital and Leonard Green & Partners LP, the majority owners, each with 49 percent stakes, with $200 million cash on hand and a $150 million financing package.
Falcone said the Palms has always been familiar to Station Casinos — the Fertitta family, who own controlling interest in the company, was an original investor in the Palms when it first opened in November 2001.
Red Rock Resorts announced in May that it would acquire the 700-room Palms property and its 600 condominium units for $312.5 million.
The Palms’ 1,700 employees will be retained and they and hourly third-party food and beverage workers would not lose salary, benefits or seniority when the transition to Station occurs.
Falcone said over the next six to 18 months, the company would invest in freshening all aspects of the property.
Falcone said for now, the casino will keep its contract with CG Technology to manage its race and sportsbook. Other Station books have in-house management and Falcone said the CG contract may be reviewed in the future.
Gaming Commission Chairman Tony Alamo said he was encouraged that it appeared Red Rock was getting along better with the Culinary Union since there was no presence by union members at Thursday’s meeting.
When the licensing request was heard by the state Gaming Control Board on Sept. 7, the meeting chamber was filled with red-shirted Culinary representatives. In the past, the union has pressured Station to allow it to represent employees at the company’s properties. Since the board meeting, the union conducted a successful representation campaign at Boulder Station in a secret-ballot vote.
Falcone said the company would continue to meet with union officials. The Palms currently doesn’t have a union contract.
Commissioners also zipped through the Aliante approval.
For Boyd, Aliante will be its 10th property in Southern Nevada and 22nd in the Boyd chain.
Boyd is in the midst of $100 million in companywide upgrades to rooms and restaurants, already completing improvements at The Orleans, Suncoast and the Gold Coast with work coming up next at Boyd’s California and Sam’s Town properties.
Aliante, initially opened by Station Casinos in November 2008, has 211 hotel rooms and a 125,000-square-foot casino. Twelve banks and private-equity investors took over the property when Station filed for bankruptcy protection in 2009. Boyd announced in April that it had acquired Aliante for $280 million.
Contact Richard N. Velotta at firstname.lastname@example.org or 702-477-3893. Follow @RickVelotta on Twitter.