Partnering with the Gambling Industry....

And so it goes:

".... If a bank wants any money out of it, they have to keep it operating.”

These figures are interesting in light of the 20,000 jobs continually promised in Massachusetts:

1,700-room hotel-casino operating and 1,800 people employed.

Maybe that tells you this is a scam?

Experts: Silver Legacy in Reno unlikely to close
$142.8M mortgage payment due March 1
Written by Bill O'Driscoll

The Silver Legacy Resort Casino told employees Thursday that the owners have no intent to close after notifying regulators this week of plans to restructure a $142.8 million mortgage payment due March 1.

“I want to assure you that our business is doing well. We are continuing to grow as a leading property in Northern Nevada. We believe our discussions with lenders are going to help us make our company even stronger,” General Manager Gary Carano wrote in a letter to his 1,800 employees.


In an accompanying statement to the media, Carano said the restructure plan is a “proactive effort” to address the recession’s impact on Nevada’s gaming industry and “position Silver Legacy for long-term success.”


Even so, the Securities and Exchange Commission filing had industry observers speculating whether the 35-story resort, built by the Carano family and Circus Circus at Fourth and Virginia streets nearly two decades ago, could fall into foreclosure or bankruptcy.


The last thing creditors want is to take over a Reno casino in a bad economy, they said, so it behooves all parties concerned to keep the 1,700-room hotel-casino operating and 1,800 people employed.


“I can’t imagine anyone letting it close. It’s too big,” said Ken Adams, a longtime Reno gaming analyst. “There’s too much at stake. A closed casino is worthless. If a bank wants any money out of it, they have to keep it operating.”


Bill Eadington, a Reno economist considered one of the world’s leading experts on gaming issues, agreed.


“There may be internal issues. My suspicion is the real problem is cash flow, not generating enough cash to service its debts,” said Eadington, director of the Institute for the Study of Gambling and Commercial Gaming at the University of Nevada, Reno. “Closure is almost out of the picture. It’s such a core property, to have that go dark would be chilling.”


Added David Schwartz, director of the Center for Gaming Research at the University of Nevada, Las Vegas, “I’ve got to think the building is more valuable with gamblers inside than with a padlock on it.”

(Page 2 of 2)

The Silver Legacy is owned by Circus and Eldorado Joint Venture, created in the early 1990s by Don Carano, a Reno attorney and owner of the Eldorado Hotel-Casino, and the owners of Circus Circus Reno now part of MGM Resorts International in Las Vegas.

Don Carano has since retired, giving control of the businesses to his sons and daughter who hold various management positions at the Eldorado and Silver Legacy.

One son, Glenn, Silver Legacy director of marketing, sits on the board of the Reno-Sparks Convention & Visitors Authority, and son Gary was a key advocate for a $2 room tax hike enacted for the downtown properties for upgrades to the National Bowling Stadium across from the Silver Legacy.

In July 1995, the Silver Legacy opened amid fireworks and adoring crowds at a cost of $350 million.

The tallest structure in Reno, it sits in the middle of a trio of properties – the Eldorado to the south and Circus Circus north – linked by elevated enclosures above Fourth and Fifth streets.

While it was a time of hopeful prosperity, it didn’t take long for other downtown casino operators to complain about the newcomer.

Pete Claudianos Jr., then-president of the Sands Regency Hotel-Casino, said the Silver Legacy was siphoning off his and other established business’s clientele instead of drawing in new visitors.

By the end of the 1990s, Washoe County would see its gaming revenues begin contracting with the advent of tribal gaming in California and later, recession. In the first decade of the new century, at least eight downtown casinos were closed.

“At one point in about 2000, Washoe had (about) $1 billion in gaming revenues. Today, it’s under $700 million,” said Schwartz, with the Center for Gaming Research at UNLV.

The SEC filings show the Silver Legacy owners operated at a loss of $9.5 million in 2010, following losses of $4.7 million in ‘09 and $8.7 million in 2008.

Additionally, the documents show total assets in 2010 of $275.25 million against total liabilities of $169.42 million, and a cash balance as of Dec. 31, 2010 of $31.65 million, down 28 percent from 2008.

“The Silver Legacy is the product of a bygone era when gaming in Northern Nevada was growing, so to some extent, this is probably inevitable,” UNR economist Elliott Parker said of the SEC filings.

“Gaming I don’t think will come back in Reno. So it makes some sense to want to restructure. Lenders really have no good option than to work with them as long as they can.”