Flamingo Laughlin Changes Hands After Nevada Gaming Commission Approves $170 Million Sale

Nevada regulators greenlit the $170 million sale of the Flamingo Laughlin casino to American Real Estate Partners, clearing the way for a change in ownership. The purchase marks the second change in ownership for a Laughlin casino in the past year, with American Real Estate Partners planning to invest $30-40 million in refurbishments. The company, led by CEO Richard Brown, sees opportunities in the market, citing growth in residential population and potential for cross-marketing with existing Las Vegas casinos.

Key Takeaways:

• The Nevada Gaming Commission approved the $170 million sale of the Flamingo Laughlin to American Real Estate Partners in just 20 minutes.
• American Real Estate Partners will invest $30-40 million in refurbishing the Flamingo Laughlin, which has 1,907 hotel rooms and a 57,000-square-foot casino.
• The company plans to upgrade the casino's machines to include ticket-in-ticket-out technology and introduce a new name and theme for the property, which will remain the Flamingo through October.
• Laughlin has been a challenging market for casino companies in recent years, but Brown sees opportunities in cross-marketing and residential growth in the area.
• The sale marks the second change in ownership for a Laughlin casino in the past year, following Landry's Restaurants' purchase of the Golden Nugget Laughlin in September.
• The Flamingo Laughlin's casino has 1,400 games, with about 30 percent currently equipped with ticket-in-ticket-out technology.
• American Real Estate Partners, led by CEO Richard Brown, has previously worked at the Flamingo Laughlin, giving him a personal connection to the property.
• The company plans to explore its options with an undeveloped 7.7-acre parcel in Atlantic City next to its Sands casino.
• JoAnn H. Giardina, chairman of the Nevada Gaming Commission, welcomed the sale, stating, "We're glad to see this transaction going forward."

Statistics:

• The Flamingo Laughlin has 1,907 hotel rooms and a 57,000-square-foot casino.
• The casino has 1,400 games, with about 30 percent equipped with ticket-in-ticket-out technology.
• American Real Estate Partners plans to invest $30-40 million in refurbishing the Flamingo Laughlin.
• Gaming revenues in Laughlin decreased from $621.2 million in 2005 to an unreported number in the recent past.
• The sale price of $170 million represents a significant increase over Harrah's purchase price of the Flamingo Laughlin in 2005, which was part of the $9 billion buyout of Caesars Entertainment.

Sources:

• Las Vegas Review-Journal, May 19, 2006
• Nevada Gaming Commission
• American Real Estate Partners
• Harrah's Entertainment
• Caesars Entertainment
• Landry's Restaurants
• Aztar Corp.