Las Vegas Sands to Sell Pennsylvania Casino
It was widely reported in the news media last week that Las Vegas Sands, the largest casino company in the world, is seeking to sell its Pennsylvania property, the Sands Casino Resort Bethlehem. The story was first reported by Bloomberg News and was later picked up by other outlets. The Sands company won’t confirm the reports, with Bloomberg citing an anonymous source.
The same source went on to say that it is basically part of the company’s strategy to be open to selling any of its casino properties at any time, with the exception of their extremely profitable casinos located in the Asian gambling capital of Macau.
Currently the Bethlehem Sands property is enjoying record profits and is performing well financially for the company. It is situated on land formerly occupied by the Bethlehem Steel Company and opened to the public in May of 2009 with the hotel opening two years later in 2011. Analysts speculate that the financial success of the Bethlehem Sands might be a major motivation behind Las Vegas Sands’ desire to sell the resort.
Like in many states, the gambling industry in Pennsylvania is facing mounting pressure from its neighboring states, particularly the state of New York, which has been looking into expanded gambling. The Philadelphia Inquirer reported last week that the state of Pennsylvania collected $3.16 billion in gambling revenue in 2012, causing it to surpass Atlantic City to become the second-largest gambling market in the United States.
Sands may very well be looking to sell while the selling is good, so to speak, and before competition from other states begins to affect the price the company might be able to fetch for the Bethlehem property. A spokesman for Las Vegas Sands, Ron Reese, refuted that notion by saying, “We’re very pleased with the financial performance of the Bethlehem property, and the role we have played as a partner in the community. But we do not comment on market speculation and rumor.”
The company spent $800 million developing the property, making it the most expensive and most luxurious casino in the state. It has a hotel featuring over 300 guest rooms, 12,000 square feet of meeting and convention space, as well as an indoor pool and fitness area. In addition to its casino (complete with table games), Sands Casino Resort Bethlehem also features a handful of bars and lounges together with the full complement of dining options, including several restaurants by celebrity chef Emeril Lagasse.
By all accounts, Sands Bethlehem has been well-received by the city and community and enjoys a good reputation in the area.
Bethlehem mayor John Callahan said of the rumored sale, “I have not heard a single word about the Sands being sold, so I have no comment on that. But you know we’ve had a great relationship with the Sands. When it comes to casinos, you can have a Walmart or you can have a Neiman Marcus. We’ve been fortunate to have the Neiman Marcus of casinos. What other casino company could have continued building the way they did right through the recession?”
If the talk about Sands wanting to sell out of Bethelhem is true, they may find it hard to complete such a deal, with Bloomberg News pointing out a couple of potential bumps in the road. For one, the purchase price would be incredibly high, with many of the companies who might be potential buyers already occupied with other projects.
Still, there are many who don’t doubt the veracity of the reports, including Bethlehem city council member David DiGiacinto, who said, “If the story is true, it doesn’t surprise me. When you’re talking about an operation performing as well as this is, and if a corporation is looking to divest itself of it, it is an opportune time.”
