Closings

I’m in Atlantic City, and the big news is the purchase and imminent closing of the Sands. You can read about it from the Inquirer:

Las Vegas-based Pinnacle Entertainment Inc. will buy the Sands Hotel & Casino – the smallest casino in an Atlantic City that has been getting bigger and brighter – and a neighboring site along the Boardwalk, for about $250 million.

Yesterday’s announcement capped weeks of speculation about Pinnacle’s plans to try to acquire an Atlantic City casino. The company was outbid in May in its protracted attempt to buy Aztar Corp., the owner of the Tropicana Casinos in Atlantic City and Las Vegas.

The Sands and the adjacent land, which is the site of the former Traymore hotel, are owned by business entities affiliated with billionaire Carl Icahn. Pinnacle will pay an additional $20 million for some tax-related benefits and other real estate.

Icahn, the owner of three casinos in Las Vegas, took control of Atlantic City’s Sands in 2000.

The companies said the hotel-casino would be closed by mid-November, with 2,100 employees to get 60 days’ notice of the expected date. They will receive severance packages.

“It’s a great location, but you will have to tear down and start from scratch,” said gambling analyst Larry Klatzkin of New York-based Jefferies & Co.

That appears to be the game plan. The statement from Pinnacle and the Sands said there were plans to close, demolish, and later replace the existing casino with a bigger casino hotel.

Pinnacle to buy Sands, adjacent Boardwalk site

Now all Pinnacle has to do is to name the new casino the Traymore, and build something suitably magnificent. In this post I give my rationale for it all.

Projects like the Belterra and especially the L’Auberge du Lac are signs that Pinnacle has the right idea. I’d hate to see a bland 25-story, 1000-room, 3000-slot Casino Magic or Boomtown get built on the Boardwalk, though. With Borgata leading the way, and MGM Mirage’s City Center East possibly waiting in the wings, you’re going to have to build something different and iconic to make an impression.

The Borgata had a great game plan–build the nicest property in town, and plan to expand. I think that Pinnacle will have enough room to follow this blueprint, and develop a true masterplan for the property before they even raze it. For all I know they already have.

There’s a downside, of course: the 2000 people who will lose their jobs in November, which is usually a tough month to get hired anyway. Hopefully Pinnacle will help them with job placement. And the other casinos should be onthe lookout, because there will be some very talented people at all levels looking for work.

In Las Vegas, there’s a story of another closing. The legendary Stardust will be closing its doors November 1. Straight from the press release, which was short and to the point:

Boyd Gaming Corporation (NYSE: BYD) today announced that it is planning to close the Stardust Resort and Casino on Wednesday, November 1, 2006. The Company will begin demolition of the Stardust in the first quarter of 2007 to make way for its Echelon Place development.

I thought that maybe they’d try to make it through the New Year, but that won’t be happening. This is hardly a surprise to anyone, because we’ve known that work on Echelon Place would be starting in 2007. But releasing an official date gives it a sense of finality that we didn’t have before.

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