Post on 19-May-2015
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Kansas Lottery Gaming FacilityKansas Lottery Gaming Facility Review BoardReview Board
August 13, 2008August 13, 2008
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Pinnacle Proposal HighlightsPinnacle Proposal Highlights
Greatest Revenue GeneratorHighest gaming revenuesMost money for Kansas
Most TouristsLargest convention centerLargest and highest-quality hotel
Best LocationSuperior access and visibilitySchlitterbahn
Proven Gaming OperatorEleven casinos in operationExperience in similar markets
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Who is Pinnacle?Who is Pinnacle?
NYSE-traded gaming company with headquarters in Las Vegas, NevadaOperations in Missouri, Nevada, Louisiana, Indiana and ArgentinaBuild and operate high-quality casino destinations customized for each marketExperienced management team with extensive backgrounds in competitive gaming environmentsOver 8,600 employees$1 Billion in annual revenues
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INDIANAPOLISCINCINNATI
LEXINGTON
LOUISVILLE
DALLAS/FORT WORTH
AUSTIN
HOUSTONSAN ANTONIO
SACRAMENTO
SAN FRANCISCOOAKLAND
Pinnacle Properties
Pinnacle Development Sites
Large Regional Cities
NEW ORLEANS
BOSSIER CITY
INDIANA
RENO
SOUTH AMERICA
LAKE CHARLES
ATLANTIC CITY
PHILADELPHIA
CENTRAL CITY
HEADQUARTERS
CHICAGO
NEW YORK CITY
BATON ROUGE
DENVER
ST. LOUIS
Potential Future Development Sites
Pinnacle PropertiesPinnacle Properties
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BelterraBelterra Resort and Casino Resort and Casino –– VevayVevay, Indiana, Indiana
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LL’’AubergeAuberge du Lac du Lac –– Lake Charles, LouisianaLake Charles, Louisiana
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LL’’AubergeAuberge du Lac du Lac –– Lake Charles, LouisianaLake Charles, Louisiana
7 Lumiere Place: Casino Site
LumiLumiéérere Place Place –– St. Louis, MissouriSt. Louis, Missouri
8 Lumiere Place: Casino Site
LumiLumiéérere Place Place –– St. Louis, MissouriSt. Louis, Missouri
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LumiLumiéérere Place Place –– PerformancePerformance
Opened December 19, 2007Year 1 projected gaming win = $134.9MYear 1 (January 2008 – June 2008) actual gaming win = $80.0MOutperforming table game business
18.5% of table games in market30.0% of table game revenueTable games = high end play, tourism
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Internal Regulatory ProcessInternal Regulatory Process
Character, honesty, and integrityCredibility is most valuable currency in the gaming industryProven track record in other regulatory jurisdictionsComprehensive and effective compliance programProblem-Gaming Program
Member of AGASelf-ExclusionTraining, Training, Training
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Recent Capital Raising HistoryRecent Capital Raising HistoryMay 2003 $240 million credit facilitySept 2003 $135 million senior subordinated notesDec 2003 $300 million credit facilityFeb 2004 $128 million equity offeringMar 2004 $200 million senior subordinated notesAug 2004 $400 million amended credit facilityDec 2004 $100 million senior subordinated notesDec 2004 $84 million equity offeringDec 2005 $750 million credit facilityJan 2006 $189 million equity offeringNov 2006 $1 billion amended credit facilityJan 2007 $368 million equity offeringJune 2007 $385 million senior subordinated notes
TOTAL $4.3 Billion
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Pinnacle
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Site SelectionSite Selection
East side of I-435 allowed proximity to infrastructure without west-side traffic concerns66 acres allows for future expansionProximity to Schlitterbahn’s planned 1,600 hotel rooms creates unmatched destination
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Selected Selected JerdeJerde Partnership ProjectsPartnership Projects
Canal City Hakata, Fukuoka, JapanMorongo Casino Resort & Spa Cabazon, California
The Gateway, Salt Lake City, Utah
Palms Casino Resort
Las Vegas, NevadaBellagio Las Vegas, Nevada
Treasure Island Las Vegas, Nevada
Wynn Las Vegas, Nevada
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Project ComponentsProject Components
100,000-square-foot casino100,000 square foot convention center
Designed to expand to 200,000 square feet50,000 square foot entertainment venue
200 five-star hotel rooms300 four-star hotel roomsFull service spa and salonDining options ranging from gourmet to fast casualCenter island performance stage and nightclub
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CasinoCasino
100,000 square feet of gaming2,300 slots; 60 table games; 25 poker tablesDesigned for future expansionA casino is not a commodity; it requires operational expertise and knowledge to operate successfully
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Convention CenterConvention Center
Largest convention center of any applicant100,000 CONTIGUOUS square feetDesigned to expand to 200,000 square feetKey for mid-week and off-season hotel occupancy to create year-round destination
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HotelHotel
Largest hotel of any applicant500 total rooms, including:Experience developing luxury-branded hotels
Four Seasons Hotel at LumièrePlace in St. Louis
Schlitterbahn plansinclude 1,600 hotel rooms
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Restaurants and LoungesRestaurants and Lounges
Variety of outlets from casual to gourmetHistory of using nationally and locally renowned chefs
Hubert KellerJeff Ruby
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EntertainmentEntertainment
50,000 square-foot indoor venue for live events
4,000 seats
Existing network of entertainment booking for other Pinnacle propertiesOutdoor stage for live events
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RetailRetail
15,000 square feet of retailVillage West area is already a shopping destination with three million existing square feet of retailSchlitterbahn is building 750,000 square feet of retailGoal of boutique retail is to complementexisting retail, not compete with it
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SchlitterbahnSchlitterbahn
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SchlitterbahnSchlitterbahn
Travel Channel rated #1 place to “Cool Off in America”2007 Golden Ticket award for #1 indoor waterpark in the U.S.Named #1 water park in the U.S. by the Travel Channel (2006)Amusement Today magazine readers voted Schlitterbahn the world's best water park in 1998, an honor the park has received annually ever sinceSchlitterbahn was voted the nation's number one water park by the readers of Inside Trackmagazine in 1996Lead into travel channel video…
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Integrated Site PlanIntegrated Site Plan
Will create a strong super-regional destination with over 2,000 hotel rooms
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Family DestinationsFamily DestinationsDisneyland – Anaheim, CA
Downtown Disney
Disneyworld – Orlando, FLPleasure IslandMust be 21 to enter
Atlantis ParadiseIsland – Bahamas
Multiple resorthotelsWater parkintegratedwith casino
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Project ScheduleProject Schedule
September 2008: Management contract awardedNovember 2008: Kansas Racing & Gaming ratifies selectionJuly 2009: Temporary casino opens – Kansas begins receiving gaming revenuesEarly 2011: Permanent casino opens with all guaranteed components
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Senate Bill 66Senate Bill 66
“The board shall determine which contract best maximizes revenue, encourages tourism and otherwise serves the interests of the people of Kansas.”
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Senate Bill 66Senate Bill 66
“The board shall determine which contract best maximizes revenue, encourages tourism and otherwise serves the interests of the people of Kansas.”
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Most RevenuesMost RevenuesPinnacle will produce the highest revenues
Gaming revenue = $401.5MNon-Gaming revenue = $86.8M
Development and operating expertiseNo traffic congestion with existing development west of I-435MyChoice program
National database of 4.7 million GAMERSPinnacle will cross-market Kansas casino with its national network of existing casinos
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Senate Bill 66Senate Bill 66
“The board shall determine which contract best maximizes revenue, encourages tourism and otherwise serves the interests of the people of Kansas.”
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Most TouristsMost Tourists
Pinnacle will draw the most touristsNumber of tourist visits = 441KTotal tourist spend = $86.3M
Largest hotel of any applicantLargest convention center of any applicantWith adjacent Schlitterbahn project, will create a national destination with over 2,000 hotel rooms
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Senate Bill 66Senate Bill 66
“The board shall determine which contract best maximizes revenue, encourages tourism and otherwise serves the interests of the people of Kansas.”
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Economic ImpactEconomic Impact
Create 2,000 union construction jobsEmploy 1,500 peopleGenerate over $17 million/year in new property taxes, including
Over $7 million/year for the KCK (USD #500) school districtPinnacle Proposal is the ONLY gaming proposal in the USD #500 school district
Attract millions of incremental new visitorsPurchase over $50 million in annual goods and services from local suppliers
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School District ComparisonSchool District ComparisonStudents Free/Reduced
LunchGraduation Rate
Kansas City, Kansas (USD #500)
18,203 82% 78%
Bonner Springs/Edwa rdsville (USD #204)
2,337 35% 88%
Piper (USD #203)
1,530 8% 97%
Source: Kansas State Department of Education
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GVA Marquette Revenue ProjectionsGVA Marquette Revenue Projections
Gaming revenue = $366.5MTotal tourist gaming win = $71.9M
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GVA Marquette Site EvaluationGVA Marquette Site Evaluation
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GVA Marquette Site ComparisonGVA Marquette Site Comparison
“We believe the Pinnacle site is the superior site among the five sites evaluated. A casino at this location, in combination with the Schlitterbahn attraction and lodging units, would create a unique gaming destination that would expand the regional gaming market, thus maximizing the amount of revenue generated by visitors from outside the local market… For these reasons we believe that this site is likely to generate the highest gaming revenues of the five sites evaluated.”
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Casino ExpertiseCasino Expertise
Proven casino operating expertiseOperate 13,000 gaming positions across 13 properties
Proven casino development expertiseOver $1 billion of new casino/hotel development within the past 3 years
Kansas needs an operator that can generate the most gaming revenues
Well-established competition in Missouri
Able to generate higher gaming revenues than our competitors
Least traffic congestionRewards program linked to national network of properties
Best complement to existing tourism destination
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Applicant ComparisonApplicant ComparisonMajor Commericial Casinos
Tribal Casinos
Racinos Countries/S tates
Hotel Rooms
Slot Machines
Table Games
Pinnacle 9 N/A N/A 6 2,634 10,695 360
Cordish/ Speedway
0 0 1 1 0 2,000 0
Golden Gaming
4 0 0 2 70 1,668 40
Mohegans/ Red
0 1 1 2 1,176 8,400 318
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Project ComparisonProject ComparisonMunicipality Hotel
RoomsConvention Center
Traffic Impact
School District
Pinnacle Kansas City, Kansas
500 100,000 Negligible KCK (USD #500)
Cordish/ Speedway
Kansas City, Kansas
300 58,000 Significant Bonner (USD #204)
Mohegans/ Red
Kansas City, Kansas
350 35,500 Significant Piper (USD #203)
Golden Gaming
Edwardsville, Kansas
300 35,000 Moderate Bonner (USD #204)
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Pinnacle CommitmentsPinnacle CommitmentsWork with local communities to have lasting positive effect on neighborhoodStrive to be excellent corporate citizen with dedication to local charities and community service
Community enhancement projectsCommitment to Wyandotte County:
$1 million upon opening$1 million ANNUALLY during operations
Aggressive diversity goals in hiring and working with minorities and womenConvert Western Wyandotte County from a regional destination into a national destination
Convention CenterLuxury HotelWorld-Class Casino
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ConclusionConclusion
HIGHEST RevenuesBest siteExperience, experience, experience
Most TouristsLargest hotelLargest convention centerAdjacent to Schlitterbahn
Best Interests of KansasProven track recordKeep our promises
Kansas Lottery Gaming FacilityKansas Lottery Gaming Facility Review BoardReview Board
August 13, 2008August 13, 2008