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Vol. 7 No. 10, October 2008, Dateline
Penn Pulls Out
The business of gaming is always a
gamble, but nowhere is that more apparent than in Kansas, where four
regional casinos and three racinos that have been in the works for
months all seem to be in a state of flux.
Case in point: Penn National Gaming, Inc. If it can’t have both, it doesn’t want any.
The Pennsylvania-based gaming company last month said it’s withdrawing from building and running a casino in Cherokee County, Kansas, after it lost its bid to Harrah’s Entertainment Inc. to also operate a casino in Sumner County.
Penn National was the only bidder for the Cherokee County regional casino and had already been awarded that contract on August 22. State officials reluctantly agreed to allow the company to space its minimum $250 million investment over a dozen years instead of up front. But it was competing against two other bidders in Sumner County.
Penn National had earlier told the Lottery Gaming Facility Review Board that it couldn’t successfully compete against the $300 million Downstream Casino Resort that the Oklahoma-based Quapaw Tribe opened in July on the Oklahoma/Kansas border, unless it employed a “southern Kansas” strategy of two casinos.
After it lost to Harrah’s a Penn National spokesman responded, “We’re clearly disappointed… A Cherokee County casino on a stand-alone basis would be very difficult to justify, given the market conditions there and the competition across the street.”
Cherokee County immediately filed suit against Penn asking for millions of dollars in damages.
Case in point: Penn National Gaming, Inc. If it can’t have both, it doesn’t want any.
The Pennsylvania-based gaming company last month said it’s withdrawing from building and running a casino in Cherokee County, Kansas, after it lost its bid to Harrah’s Entertainment Inc. to also operate a casino in Sumner County.
Penn National was the only bidder for the Cherokee County regional casino and had already been awarded that contract on August 22. State officials reluctantly agreed to allow the company to space its minimum $250 million investment over a dozen years instead of up front. But it was competing against two other bidders in Sumner County.
Penn National had earlier told the Lottery Gaming Facility Review Board that it couldn’t successfully compete against the $300 million Downstream Casino Resort that the Oklahoma-based Quapaw Tribe opened in July on the Oklahoma/Kansas border, unless it employed a “southern Kansas” strategy of two casinos.
After it lost to Harrah’s a Penn National spokesman responded, “We’re clearly disappointed… A Cherokee County casino on a stand-alone basis would be very difficult to justify, given the market conditions there and the competition across the street.”
Cherokee County immediately filed suit against Penn asking for millions of dollars in damages.
Staff writers for Global Gaming Business magazine. Las Vegas, Nevada.
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