Speaker 1: This is Bloomberg Business Week with Carol Masser and Jason
Speaker 1: Kelly on Bloomberg Radio. All right, so hospitality, gaming and
Speaker 1: we love to talk about all of it, and no
Speaker 1: one better to talk about it. And really at the
Speaker 1: center of all that Jim Allen. He's the chairman of
Speaker 1: hard Rock International, also the CEO of Seminole Gaming, based
Speaker 1: down in Fort Lauderdale, Florida, here in our Bloomberg Interactive
Speaker 1: Broker's studio today. Jim, great to have you with us.
Speaker 1: Thanks for having us. All right, well, I want to
Speaker 1: start just before we even get into it, asking you
Speaker 1: about New Orleans. Obviously that has been top of mind
Speaker 1: for a lot of people in your business, certainly top
Speaker 1: of mind for you, specifically what's the latest and what
Speaker 1: happens next? You know, first thing and most importantly, our
Speaker 1: prayers go out to the families of the victims and
Speaker 1: those that were injured, and also the supporting businesses around
Speaker 1: the site itself. So that is really where our focus
Speaker 1: is right now. A major tragedy and we look forward
Speaker 1: to working with the mayor of the city officials to
Speaker 1: try to move forward, right and will you ultimately rebuild
Speaker 1: in New Orleans. We certainly love New Orleans. UM Our
Speaker 1: Cafe has been there for over twenty years, an amazing site,
Speaker 1: but certainly we have to work with the local partners
Speaker 1: and and obviously be respectful to the situation we're in now,
Speaker 1: right exactly, UM, do you I have you guys that
Speaker 1: have gotten to the bottom of it in terms of
Speaker 1: what happened. No, you know, the site is really still
Speaker 1: um you know, and it's in a search mode if
Speaker 1: you will, So no one is really going down that
Speaker 1: particular path at this time. And as a respect to
Speaker 1: the victims. All right, so let's talk about the expansion
Speaker 1: that's happening heavily underway. This is an iconic brand in
Speaker 1: a lot of ways. You and I were talking about
Speaker 1: a little bit before we came on air. Uh, the
Speaker 1: guitar Hotel. Tell me about that. Well, we are opening
Speaker 1: the world's for s guitar shaped hotel UM this Thursday,
Speaker 1: octob really excited about it. Is an iconic structure. Nothing
Speaker 1: else in the world has ever been designed similar to it,
Speaker 1: and we look forward to an amazing opening. Well, tell
Speaker 1: us a little bit about that, and and tell us
Speaker 1: about kind of what kind of space you're hoping to
Speaker 1: create and who you're hoping to attract. It's a one
Speaker 1: point five billion dollar expansion and hard Rock being one
Speaker 1: of the most globally recognized brands, this really becomes the
Speaker 1: flagship when we look at what we do both in
Speaker 1: the restaurant business, the retail certainly the gaming business online gaming.
Speaker 1: But this is truly an integrated resort and a true destination,
Speaker 1: and that really takes us to a whole another level.
Speaker 1: All Right, So I gotta talk a little Vegas. Um.
Speaker 1: You know, you and I were talking again before we
Speaker 1: came on air. I mentioned that I had stayed at
Speaker 1: at that property, which is not your property, and that's
Speaker 1: important because where the hard Rock Hotel and casino once
Speaker 1: we're that branding is coming off Brandon, I believe is
Speaker 1: rebranding that that would seem to provide an opening for you.
Speaker 1: What are your Vegas plans? Yeah, when we actually purchased
Speaker 1: hard Rock back in two thousand seven, Peter Morton still
Speaker 1: owned in Las Vegas. So, um, we look at this
Speaker 1: as a as a great opportunity for our brand. We
Speaker 1: certainly recognize the amazing success that the brand has had
Speaker 1: off strip, but if something comes up in the future,
Speaker 1: we certainly would look forward to seeing what opportunities may
Speaker 1: be created in that particular environment. And you would think
Speaker 1: on strip at this point is that where you'd be looking.
Speaker 1: I don't think we're looking at this point, but I
Speaker 1: would say that, you know, as we look at opportunities. Um,
Speaker 1: certainly on strip is one of the possibilities. We're hearing
Speaker 1: Planet Hollywood and Valleys, maybe it for sale any interest? Well, Um,
Speaker 1: Planet Hollywood's very interesting and obviously the Bally's Corner is
Speaker 1: certainly one of the more legendary corners on the Las
Speaker 1: Vegas Strip. But it would be premature for us to
Speaker 1: say that we want to do something at this time,
Speaker 1: but certainly down the road, Um, if the transaction with
Speaker 1: RGIN is completed then and certainly that is one of
Speaker 1: the possibilities. There's also the Cosmopolitan. I'm just gonna say
Speaker 1: that rumor has been out there for quite some time,
Speaker 1: but no, we're not interested in purchasing the Cosmopolitan. We
Speaker 1: can go official on that one. Do they do you
Speaker 1: have more capacity to borrow after all the expansion you've
Speaker 1: done so far. You know, one of the great things
Speaker 1: we've been able to do is focus on the balance sheet.
Speaker 1: In the history of our industry. We're the only organization
Speaker 1: that has ever enjoyed an investment grade rating from Moody's
Speaker 1: Standard and Poor and Fitch simultaneously. We're levered a little
Speaker 1: around one point five coverages, you know, approaching twenty times.
Speaker 1: So that is the strength of the organization. So yes,
Speaker 1: if the right opportunity comes along, we're certainly very competitive
Speaker 1: in Japan right now. So clearly you know that equity
Speaker 1: check will be substantial if we're selected. But you know,
Speaker 1: if the right opportunity comes along, our balance sheet is
Speaker 1: obviously incredibly strong with the investment grade ratings, all right,
Speaker 1: So Jim, as we look across the country, it feels
Speaker 1: like we're think a moment when especially when it comes
Speaker 1: to sports betting. You know, a lot of enthusiasm around that,
Speaker 1: just candidly, a lot of enthusiasm around uh gambling in general.
Speaker 1: Where do you go next? Or their states? I mean Illinois, Indiana,
Speaker 1: I mean are those places where you may be doing
Speaker 1: more well? You know, we've been selected both in Illinois
Speaker 1: in Rockford and in Indiana. So there are two projects
Speaker 1: that we just recently announced that our casino projects, you know,
Speaker 1: with hospitality and other amenities. Certainly the online gaming business
Speaker 1: were already in that obviously active in the Atlantic City market,
Speaker 1: and the same with sports betting. We definitely believe that
Speaker 1: both of those sectors on a going forward basis over
Speaker 1: the next three to five ten years are going to
Speaker 1: be very important for the growth of the business on
Speaker 1: a long term basis. Can you talk a bit more
Speaker 1: about Atlantic City? I was there or was it about
Speaker 1: a year year and a half are just before hard
Speaker 1: Rock opened, uh, and was doing one of our shows
Speaker 1: down there, I mean Atlantic City. Uh, it's not it's
Speaker 1: hard not to be impressed by the investment going back in,
Speaker 1: but we've seen these cycles before and it just seems
Speaker 1: like a hard nut to crack. Well, I would say
Speaker 1: two things. We are incredibly excited about the success that
Speaker 1: we've had, you know, basically open a little over a
Speaker 1: year now for I believe it's six months running strong
Speaker 1: number two in the marketplace, right behind MGMs property to Burgata,
Speaker 1: so to literally surpass Caesars in Tropicana and Harris and
Speaker 1: all those other brands gold Nuggets that have been there
Speaker 1: for decades. We're very proud of those results. I will
Speaker 1: tell you we are disappointed that some of the things
Speaker 1: that we were believe what happened from both the State
Speaker 1: of New Jersey and and the city of Atlantic City
Speaker 1: are moving a little slower than what we had hoped for.
Speaker 1: So we continue to try to work with Governor Murphy
Speaker 1: to stress the importance, you know, of the size of
Speaker 1: this market. It's still the second largest gaming market in
Speaker 1: the United States at two point six billion dollars and
Speaker 1: frankly grew double digit last year. But the infrastructure Atlantic
Speaker 1: City continues to need additional assistance. All right, Jim, only
Speaker 1: got about third seconds left. You've been in the hospitality
Speaker 1: business for a long time. You've seen cycles come and go.
Speaker 1: Where are we when it comes to the consumer right now,
Speaker 1: the health of the especially the tourist consumer. I would
Speaker 1: say caution is probably something that would be advisable. Um,
Speaker 1: we've basically been on a nine ten year run in
Speaker 1: the hotel sector here, you know, with multiple hitting fourteen
Speaker 1: sixteen times. You mentioned the Cosmo, you know, going for
Speaker 1: guidance of three billion dollars um. So I think caution
Speaker 1: is very um prudent at this particular point. Um. We
Speaker 1: certainly think the industry obviously still has some tremendous upset.
Speaker 1: All right, great to spend some time with you. Thank
Speaker 1: you so much for coming by. Jim Allen is a
Speaker 1: chairman of hard Rock International, the CEO of Seminal Gaming
Speaker 1: as well, based down in Fort Lauderdale, Florida.