Operator News
US – Stratosphere to take gaming to new heights
By Phil - 19 March 2018
Golden Entertainment is to spend $140m on redeveloping Stratosphere Casino, Hotel & Tower, in a move that will see a complete refresh of its iconic Top of the World restaurant and Tower experience with the addition of a dedicated casino area conveniently located near access to the tower thrill rides to appeal to a younger visitor demographic.
Golden Entertainment bought the casino from American Casino & Entertainment as part of a four casino package for $850m last October.
The Stratosphere’s three year redevelopment plan will also see state-of-the-art digital signage and lighting installed on the property’s exterior. It will also transform existing unused space into approximately 50,000 square feet of meeting space targeted at modest-sized groups and conventions. It will rennovate over 1,100 rooms, representing nearly 50 per cent of the existing room base. Golden will add a unique gastro-brewery, featuring Golden Entertainment’s signature branded craft beer and menu, which will be connected with a remodeled, state-of-the-art sports and race book. It will also add a new steakhouse, noodle bar and other food outlets.
Golden Entertainment expects to begin work on the redevelopment project in the second quarter of 2018 and, to minimise disruption to the Stratosphere’s current operations, intends to phase the construction over a three-year period ending in the summer of 2021.
Blake Sartini, Chairman and Chief Executive Officer of Golden Entertainment, said: “Our strategic priorities for 2018 include the ongoing integration and synergy realisation from the American acquisition, the introduction of a single loyalty card program across all of our operations, and the commencement of focused capital investments at Stratosphere that we expect will further establish the property as a unique destination for visitors to the north end of the Las Vegas Strip. Since completing the acquisition, our conviction has only grown stronger that targeted, return-focused investment in the Stratosphere will enhance our guests’ experiences and allow us to drive financial performance at the property. Importantly, our phased approach to this project, including further investment in the room product and the development of existing unused space within the property’s footprint, will minimise potential disruption to our current operations and allow us to maximise this iconic property’s potential.”
As well as the Stratosphere Casino, the deal brought the company Arizona Charlie’s Decatur and Arizona Charlie’s Boulder, as well as the Aquarius Casino Resort in Laughlin.
The company generated revenues for the 2017 fourth quarter of $184.3m, compared to $105.4m in the prior-year quarter. The increase in net revenues was driven primarily by the inclusion of 73 days of operations of American in the fourth quarter as well as continued revenue growth across the Company’s existing casinos and distributed gaming operations.
Mr. Sartini added: “Organic financial growth in 2017 in all of our operations, combined with our significantly expanded business across Southern Nevada following our acquisition of American Casino & Entertainment Properties, has positioned Golden Entertainment for continued growth in 2018. The addition of Stratosphere Casino, Hotel & Tower, Arizona Charlie’s Decatur, Arizona Charlie’s Boulder, and the Aquarius Casino Resort has significantly scaled our operations in the Las Vegas Valley and Southern Nevada with leading assets which are complementary to our unique platform of casinos, taverns and route operations. Notably, since acquiring the American properties in October, we are seeing encouraging cross-play trends, with our tavern customers visiting the Stratosphere, Aquarius and Arizona Charlies’ locations in increasing numbers.
“Going forward, we remain confident that the health and economic vitality of the Las Vegas Valley and the surrounding Southern Nevada communities provide a tangible foundation for the long-term growth of our business. Billions of dollars of expected new investment in the greater Las Vegas area in large-scale gaming projects on the Strip as well as in non-gaming venues continue to support growth of the Las Vegas economy. In addition, the local community’s support for professional sports, reflected by continued sell-outs by the Golden Knights and a building anticipation for arrival of the Raiders, has brought new excitement and visitors to the market. These factors and others have us excited for the future as we deliver on our goal of further enhancing shareholder value.”
