Two weeks after Casino Queen of East St. Louis, Illinois announced it will purchase the Belle of Baton Rouge from Caesars Entertainment for an undisclosed price, the riverboat operator said it has reached a deal to buy a second Baton Rouge properly—Hollywood Casino Baton Rouge—for $28.2 million. The sale is expected to close in the second half of 2021.
Hollywood Casino owner Gaming and Leisure Properties Inc. said it will continue to own Hollywood Casino’s real estate and lease the venue to Casino Queen, adding it still plans to move the downtown casino onto land. GLPI also owns the Belle of Baton Rouge’s real estate. Casino Queen will own two of Baton Rouge’s three casinos if the deal goes through.
Casino Queen operates two Midwest riverboat casinos: DraftKings at Casino Queen in East St. Louis and Casino Queen Marquette in Marquette, Iowa.
Casino Queen President and Chief Executive Officer Terry Downey said the transaction will allow the company to expand its regional footprint into Baton Rouge. “We feel that with sports betting coming on, along with traditional gaming, we have a lot to offer to our valued customers,” Downey said.
Louisiana Gaming Control Board Chairman Mike Noel said companies have owned more than one casino in the same market, such as Caesars, which owns Harrah’s Louisiana Downs and Horseshoe, both in Bossier City. However, he said the Casino Queen deal “does pose questions. There are going to be questions we need to dig into.”
Noel said one of the factors the gaming commission will look into regarding approval of the sale is market share. L’Auberge Casino Hotel Baton Rouge accounts for nearly two-thirds of the local market share. For the fiscal year that ended June 30, L’Auberge brought in $123.5 million in adjusted gross revenue, compared to $43.1 million for Hollywood and $20.7 million for the Belle. And as of October 31 in the current fiscal year, L’Auberge has posted $51 million in adjusted gross revenue, with $17.5 million for Hollywood and the $5.3 million for the Belle, according to the state gaming board.
Noel added potential upgrades to Hollywood and the Belle also will be considered. Hollywood will invest $25 million to move onto land, including adding a 250-seat sports bar/entertainment venue and a Shaquille O’Neal’s Big Chicken Restaurant. Belle owners also have considered moving casino operations into its 80,000-square-foot atrium next to the riverboat. Currently the property’s 288-room hotel is being renovated and will reopen in 2021.
With the Casino Queen sale, a DraftKings-branded sportsbook could open at both Hollywood and the Belle. DraftKings already has a marketing agreement with Casino Queen. In addition, GLPI said it has reached a long-term deal for a master lease for Hollywood and DraftKings at Casino Queen. Casino Queen will pay an initial rent of $21.4 million on the two riverboats. The rent at Hollywood will be increased as soon as the land-based casino opens in early 2022.
GLPI also announced it was selling Hollywood Casino in Perryville, Maryland, to Penn National Gaming. Peter Carlino, GLPI chairman and chief executive officer, called the moves “bittersweet.” He said, “We are confident that they are in good hands with the new operators of these properties and will continue to shine under Penn National and Casino Queen. By retaining the real estate of both Perryville and Baton Rouge, and continuing the development on the expansion in Baton Rouge, we retain a vested interest in their future.”
GLPI also owns the real estate at L’Auberge Baton Rouge.
