Casino news source: The Advocate - http://www.2theadvocate.com
Pinnacle weighs casino location
By MICHELLE MILLHOLLON
Published: Aug 16, 2006
A third casino riverboat could be on the horizon for East Baton Rouge Parish. However, West Baton Rouge Parish also is in the running.
Pinnacle Entertainment Inc. has snapped up two casino licenses from Harrah’s Entertainment in a $70 million deal. The Las Vegas-based company plans to use one of the licenses to expand gambling operations in Lake Charles.
Pinnacle must decide in the next few months what to do with the other license.
“We’re trying to figure out the best place that would have the most revenue potential,” Wade Hundley, president of Pinnacle, said Tuesday.
East Baton Rouge, West Baton Rouge and Jefferson parishes are among the contenders, he said.
Shreveport-Bossier City and New Orleans probably are not in the running, he said. Pinnacle’s agreement with Harrah’s includes a noncompete clause that would force Pinnacle to pay Harrah’s $100 million if it chose to locate in either of those markets, where Harrah’s has casinos, in the next five years.
Baton Rouge already has two riverboat casinos — Belle of Baton Rouge and Casino Rouge. Local gambling revenue surged after Hurricane Katrina shuttered casinos along the Mississippi Gulf Coast and in New Orleans.
Mayor-President Kip Holden said he has heard only rumors about the possibility of Pinnacle locating a boat in East Baton Rouge Parish.
“They have not had any discussions per se about their plans with us,” he said.
Across the Mississippi River, West Baton Rouge Parish has truck stop casinos but no riverboat casinos.
Speculation surfaced in the spring that Pinnacle might put a riverboat casino in Port Allen.
Parish officials have even flirted with the possibility of putting a local option election on the Sept. 30 ballot to let voters decide whether to allow a riverboat casino.
West Baton Rouge Parish President Riley “Pee Wee” Berthelot said there is no longer time to get the issue on the September ballot.
However, he said, a local-option vote could be scheduled for the March election.
Berthelot said Pinnacle is looking at two or three locations in West Baton Rouge Parish. He is patient about the delay in a decision.
“They’ve got a lot of homework to do before they can actually select a site,” he said.
The Gaming Control Board gave Harrah’s the green light Tuesday to sell its Lake Charles riverboat casinos to Pinnacle.
The deal includes a property swap.
Harrah’s is getting what is left of the hurricane-damaged Casino Magic in Biloxi, Miss. Pinnacle is acquiring Harrah’s Lake Charles hotel and two storm-battered riverboat casinos in addition to the licenses.
Hundley told the board that his company plans to move one of the riverboats next to its L’Auberge du Lac casino resort in Lake Charles.
L’Auberge du Lac opened last year and boasts a casino, hotel, 18-hole golf course and a lazy river. In July, it was the top moneymaker in the Lake Charles casino market.
Pinnacle plans to spend $350 million to create a casino resort called Sugarcane Bay next to L’Auberge du Lac, Hundley said.
Eventually, the resorts will offer 1,400 hotel rooms, he said.
Pinnacle Entertainment has 75 days to decide what to do with the other license.
Gaming Control Board member Rupert Richardson asked Hundley if Pinnacle is considering relocating Harrah’s Star casino to Baton Rouge or West Baton Rouge Parish.
Hundley confirmed those sites are under consideration.
Anthony Sanfilippo, president of the central division of Harrah’s Entertainment, told the board that Shreveport-Bossier City already is a crowded market that is competing with Oklahoma for customers.
Hundley said the market potential in Baton Rouge is strong.
However, he said there are pros and cons to each site being considered.
Shreveport-Bossier City and New Orleans probably are not in the running, he said. Pinnacle’s agreement with Harrah’s includes a noncompete clause that would force Pinnacle to pay Harrah’s $100 million if it chose to locate in either of those markets, where Harrah’s has casinos, in the next five years.
Baton Rouge already has two riverboat casinos — Belle of Baton Rouge and Casino Rouge. Local gambling revenue surged after Hurricane Katrina shuttered casinos along the Mississippi Gulf Coast and in New Orleans.
Mayor-President Kip Holden said he has heard only rumors about the possibility of Pinnacle locating a boat in East Baton Rouge Parish.
“They have not had any discussions per se about their plans with us,” he said.
Across the Mississippi River, West Baton Rouge Parish has truck stop casinos but no riverboat casinos.
Speculation surfaced in the spring that Pinnacle might put a riverboat casino in Port Allen.
Parish officials have even flirted with the possibility of putting a local option election on the Sept. 30 ballot to let voters decide whether to allow a riverboat casino.
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