In Missouri, the Gaming Commission
has decided to let Pinnacle
Entertainment Inc. develop casinos in
downtown St. Louis and in south St.
Louis County.
Wednesday, the commission voted 4-1
Wednesday to OK Pinnacle's proposal over
those of finalists Isle of Capri,
Harrah's Entertainment Inc. and Riveria
Holdings Corp. The new decision
virtually puts those three companies out
of the running, barring any unexpected
developments with Las Vegas-based
Pinnacle or its projects. Originally,
six companies were in the running for a
new development in Missouri.
Riviera stated today that it would
write off its $600,000 investment in its
plan to develop a riverboat casino in
Jefferson County, about 27 miles from
downtown St. Louis. The company said as
a result, the company would take a
pre-tax charge of about 19 cents a share
in the third quarter.
Pinnacle's downtown plans feature a
$200 million casino and five-star hotel
on Laclede's Landing that would open in
late 2006. The second project, a $300
million county complex, would open near
Lemay in late 2007. It would include a
90,000-square-foot casino, 100-room
hotel, retail space, movie theater and
bowling alley on 80 acres of land.
However, commissioner Ralph Biele,
expressed concern about whether Pinnacle
would be able to secure the necessary
approvals to build an access road
leading to the Lemay site. The road
would run on top of a levee to provide
access to the former site of National
Lead, just south of St. Louis city
limits. Similar issues over access
doomed Isle of Capri Casinos Inc.'s
plans to build a casino in Jefferson
County in 2000.
St. Louis County Executive Charlie A.
Dooley did not seem to have
reservations, hugging casino proponents
after the decision was announced. He
said it was the county's job to make the
access road happen, and that it would
happen.
In a presentation before the vote,
commission Executive Director Kevin
Mullally said he and his staff judged
Pinnacle to have enough financial
strength to carry through on the project
and an acceptable regulatory record.
Also, the commission staff
relanted that the development at
Laclede's Landing probably would mean
the downfall of the President Casino on
the Admiral, a historic riverboat docked
on the Mississippi River. It is known
that the casino's corporate owner is in
bankruptcy.
Pinnacle Chairman and Chief Executive
Daniel Lee said that he is totally
confident that his company would meet
all the required deadlines and
conditions for the deal, like improving
a key financial-strength measure by Oct.
31, 2005.
In February, Pinnacle had agreed to
operate the city casino at least a year
before opening the one in the county,
and said it would pay St. Louis $1
million per year to help make up for
money that might be lost to a county
operation. The agreement also gave the
city of St. Louis the right to approve
the hotel chain chosen downtown in the
event that the Four Seasons, St. Regis,
Fairmont or Intercontinental chains do
not locate there.
Also, Pinnacle agreed to spend $50
million on residential development in
St. Louis city, likely in the form of a
condominium tower at Laclede's Landing.
If they do not build the project within
five years of opening the downtown
casino, Pinnacle will pay a fine.
Also, he commission's meeting was
attended by members of groups opposed to
the casinos.
