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Howard Stutz

Report: Las Vegas Sands won't seek license in Boston area

23 May 2012

Las Vegas Sands Corp. on Tuesday became the second Nevada-based casino operator to take a pass on Massachusetts' fledgling gaming industry, saying the number of casinos planned was too many for the overall market.

The move by Las Vegas Sands was somewhat surprising because company Chairman Sheldon Adelson is a native of Boston.

Las Vegas Sands spent roughly $500,000 on lobbying in the state when lawmakers approved legislation last year allowing for three casinos in three distinctive regions and a slot machine parlor for a yet to be determined location.

The decision comes two weeks after Wynn Resorts Ltd. abandoned plans to build a casino-resort in Foxborough near the New England Patriots' Gillette Stadium because of community opposition.

MGM Resorts International, which wants to build a casino in the western part of the state, pulled out of its original location near the town of Brimfield but is still seeking an alternative site.

Las Vegas Sands was expected to bid on the Boston-area license, considered the most lucrative location in the state.

However, Las Vegas Sands spokesman Ron Reese said the project wouldn't fit the company's overall portfolio, which includes integrated resorts costing billions of dollars.

The company's most expensive development is the $5.5 billion Marina Bay Sands in Singapore, which opened in April 2010.

More than 80 percent of Las Vegas Sands quarterly revenues come from the company's holdings in Macau and Singapore. Las Vegas Sands is also bidding to build a $22 billion resort complex in Spain.

"With multiple facilities being proposed [in Massachusetts], it didn't sync with our business model," Reese said.

He said Adelson has long advocated that one or two integrated resorts in Massachusetts were plenty and that any more would dilute the market.

"The news of Las Vegas Sands pulling out of Boston is not surprising," Union Gaming Group principal Bill Lerner said in a note to the firm's clients. "The company thinks an investment in the Boston area wouldn't pencil out given too much gaming capacity with three casinos and a slot parlor."

Caesars Entertainment Corp. is viewed as the leading bidder for a Boston-area casino.

The company is in a partnership with the Suffolk Downs racetrack.

Also, Caesars Chairman Gary Loveman lives in the Boston area and has long-standing ties to the community, including a minority ownership in the NBA's Boston Celtics and having taught at the Harvard Business School.

Companies expected to bid on the western Massachusetts location include Las Vegas-based regional casino operator Ameristar Casinos and Penn National Gaming, which owns racetrack casinos, regional casinos and M Resort.

A license in southeastern Massachusetts is expected to be awarded to an Indian tribe.

Stephen Crosby, chairman of the Massachusetts Gaming Commission, told the Boston Globe that the panel is thinking carefully about how much casino gambling the Massachusetts market can handle.

The commission will tackle the question at a forum it is hosting in June.

Crosby declined to comment on Las Vegas Sands' decision not to pursue a casino in Massachusetts or how the absence of the company would affect competition.

"Clearly, competition is good and competition from well-funded, stable, legitimate companies is the best kind,' he told the Globe. "But at this point we're not in the business of commenting about who's in and who's out."