Casino Company Plans to Spend More Than Half a Billion in Louisiana

A conceptual rendering of the proposed front elevation for a new Eldorado casino in Lake Charles. Image via house.louisiana.gov

BATON ROUGE – The head of what will soon be the largest casino operator in the nation said Thursday he expects the company to spend more than half a billion dollars in Louisiana over the next four years.

That total includes fees paid to the state, legally mandated improvements at Harrah’s New Orleans, and a new facility in Lake Charles. But on Thursday, Louisiana Gaming Control Board Chairman Ronnie Jones grilled company officials about their plans for the Belle of Baton Rouge, consistently the worst-performing casino property in the state.

“That asset in its current state is not acceptable to the state and it’s not acceptable to us either,” Eldorado Resorts CEO Tom Reeg said.

In November, shareholders of Eldorado and Caesars Entertainment approved an $8.58 billion cash-and-stock merger. Eldorado’s current leadership team will head the combined company, operating about 60 casinos in 16 states under the Caesars name.

Reeg expects the deal to close early in the second quarter of this year. In anticipation of the merger, this week Eldorado announced the sale of its Shreveport property to Maverick Gaming. The Federal Trade Commission had raised concerns about the new company’s heavy presence in that part of the state, officials said.

Once the Maverick deal closes, the new company will operate five Louisiana properties: Harrah’s New Orleans, Horseshoe Bossier City, Isle of Capri Lake Charles, Harrah’s Louisiana Downs in Bossier City, and the Belle of Baton Rouge.

Harrah’s New Orleans will be a “flagship” for the company, Reeg said, and Eldorado already has announced a planned $100 million-plus facility in Lake Charles. Jones expressed appreciation for those investments before getting Reeg to acknowledge that, when in Baton Rouge Wednesday night prior to Thursday’s gaming board meeting in Baton Rouge, company officials stayed not at the Belle but at competitor L’Auberge Baton Rouge.

“The fact that I stayed at L’Auberge last night is a comment on our view of the state of [the Belle] as it sits today,” Reeg admitted.

Since Eldorado acquired the Belle in 2018, the casino and hotel property has missed its state employment targets every quarter and only about $1.1 million has been invested in the facility, Jones said. He said the property’s current condition reflects poorly on the city and the state’s entire gaming sector.

“We expect great things from your company,” Jones said. “I don’t want Baton Rouge to get lost in the weeds.”

Reeg said the company is considering moving the casino from its riverboat home to the atrium next door, similar to its plans in Lake Charles, but “the economics of that are not as simple as they are in Lake Charles.”

“Riverboat” casinos are a vestige of the early days of legal casinos in Louisiana, though the boats now are permanently anchored dockside.

“The next time we’re in front of you, that situation [in Baton Rouge] will be different,” Reeg promised.

Louisiana’s casino revenue fell about 5 percent in December compared to December 2018, according to totals reported to the Gaming Control Board, continuing the industry’s downward trajectory. Only three properties out of 16 showed a year-over-year increase.

As usual, the Belle of Baton Rouge showed the biggest decline in the monthly revenue report, falling more that 18 percent year-over-year.

 

By David Jacobs of the Center Square

 

Categories: Dining/Entertainment, Today’s Business News

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