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The Las Vegas-based company announced late Monday it increased the construction budget for a riverboat gaming development in Baton Rouge by more than $100 million. Pinnacle hopes to open the project in the Louisiana capital by December 2011.
The planned property will have a 200-room hotel tower, a casino with 1,500 slot machines and 51 table games, a multi-purpose event center, three restaurants, outdoor festival grounds and an 800-space covered parking garage.
Pinnacle said it would spend $357 million on the development, up from the original budget of $250 million. The company said it would fund the project through cash on-hand, cash flow from existing operations, and its $375 million credit facility.
Louisiana gaming regulators need to approve the development.
Pinnacle executives said in a statement that other Baton Rouge-area properties are older, which has sent customers to casinos in other parts of Louisiana, such as New Orleans.
"Market research indicates that a very significant portion of the adult population in the Baton Rouge region bypasses existing gaming options and travels two to three hours to other gaming markets," Pinnacle Chief Executive Officer Anthony Sanfilippo said. "The expanded scope of our project will address this customer demand with a high-quality entertainment option that will be significantly closer to potential guests."
Wall Street was quick to embrace the company's plans in Baton Rouge.
"The expanded scope of the project and larger hotel facility could make Baton Rouge more of a destination facility," JP Morgan gaming Joe Greff said.
Added Jefferies & Co. gaming analyst David Katz, "We believe management is taking a prudent approach to capital spending given the considerable opportunities to improve its current operations."
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