Isle Casino sold again; purchaser calls property 'quality asset'

A Colorado-based casino company announced Monday it has entered into an agreement to purchase operating assets at Isle Casino Cape Girardeau and has indicated a hotel could be added to the property in the future.

In addition, Century Casinos announced it is purchasing the operations of Lady Luck Casino in Caruthersville, Missouri, and Mountaineer Casino, Racetrack and Resort in New Cumberland, West Virginia. All three are owned by Eldorado Resorts Inc. of Reno, Nevada.

Century Casinos, headquartered in Colorado Springs, Colorado, said it is purchasing gaming and other operations at the three properties for approximately $107 million. Meanwhile, VICI Properties Inc., a real estate investment firm based in New York City, is acquiring the real estate assets of the three properties for approximately $278 million and will lease them back to Century Casinos.

“These are three quality assets in strong and stable gaming markets, each enjoying a leading regional position and each with a long track record of producing solid and growing profitability,” said Century Casino president and co-CEO Peter Hoetzinger during a telephone news conference Monday, adding acquisition of the two Missouri casinos and the property in West Virginia “pretty much doubles the size of our company.”

Company officials said the transaction is expected to close in early 2020, pending antitrust approval and approvals of the Missouri Gaming Commission and the West Virginia Lottery, “as well as other customary closing conditions.”

Lyle Randolph, vice president and general manager at Isle Casino here, said in a telephone interview he learned of the pending sale late Sunday night in a phone call from Eldorado Resorts. As of now, Randolph said it’s “business as usual” at the Cape Girardeau casino and he doesn’t expect any significant changes in casino operations at least until the sale is finalized.

“Nothing will change until that time,” he said.

Century Casinos operates casinos and other gaming operations in Cripple Creek and Central City, Colorado, in Edmonton and St. Albert in Alberta, Canada, and in Bath, England. The company also has part interest in gaming operations in Poland and Canada and operates several ship-based casinos under agreements with a pair of cruise lines.

Acquisition of the gaming operations in Cape Girardeau, Caruthersville and West Virginia will substantially expand New Century’s North American operations, company officials said.

In a conference call with media and investors Monday morning, Hoetzinger said the new properties fit well into New Century’s portfolio of casino operations.

“We chose these three casinos because they met all of our criteria,” he said. “They are midsize operations that target the midmarket local customer; they have been generating strong and stable cash flow for many years, they provide opportunities to provide incremental growth through operational improvements (and they) substantially enhance our scale and presence in North America.”

When asked during the call what sort of “operational improvements” the company might make in the Cape Girardeau and Caruthersville operations, Century Casino chairman and co-CEO Edwin Haitzmann said it is “too early to talk” in specifics, but he noted the company may look into purchasing and upgrading a small hotel adjacent to the Lady Luck property and “in Cape Girardeau there are plans to build a hotel.” However, he said adding a hotel adjacent to Isle Casino would probably not happen right away.

VICI Properties owns 23 gaming facilities across the nation, including Harrah’s Metropolis in Metropolis, Illinois; Bluegrass Downs in Paducah, Kentucky; Harrah’s Kansas City; and some property in Tunica, Mississippi near Memphis.

“They own the property but they don’t operate the casinos,” Randolph said.

In a news release issued Monday, VICI president and chief operating officer John Payne said the company’s real estate acquisitions in Cape Girardeau, Caruthersville and West Virginia “demonstrate VICI’s ability to execute acquisitions that bring value to our shareholders while also diversifying our tenant base and expanding our geographic footprint into a new market, West Virginia. We are excited to partner with Century as they are expert operators of small to mid-sized regional assets and are beginning their journey of expansion into the U.S. market.”

Isle Casino opened in 2012 on North Main Street in Cape Girardeau and features 41,500 square feet of casino space, 863 gaming machines, 20 table games, three dining venues and an events center. It was acquired by Eldorado Resorts in 2016 from Isle of Capri Casinos.

Lady Luck in Caruthersville is a riverboat casino that opened in 1995. The dockside operation features 21,000 square feet of casino space, just more than 500 gaming machines, nine table games, two dining venues and a 40,000-square-foot pavilion.

The Mountaineer property in West Virginia is a hotel, casino, entertainment and horse racing facility one hour from downtown Pittsburgh. the property opened in 1951 with the casino opening in 1994. It features a 357-room hotel, nearly 1,500 gaming machines, 36 table games, a poker room, a racetrack and five dining venues.

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