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Best of Liz Benston

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Liz Benston
 

Station Purchases Reno Land

29 March 2005

LAS VEGAS -- Station Casinos Inc., which has so far focused all of its Nevada business in Las Vegas, has purchased 96 acres of vacant land south

The $15 million purchase, disclosed in a proxy statement to shareholders, is for land located at the intersection of Geiger Grade Road and South Virginia Street.

Station said it bought the land and related water rights in February from the Blake L. Sartini and Delise F. Sartini Family Trust.

Delise Sartini is the sister of Station Chief Executive Frank Fertitta III and Blake Sartini -- former chief operating officer at Station Casinos -- is Fertitta's brother-in-law.

Station sold its Golden Gaming slot route to Blake Sartini in 2001. Boyd Gaming Corp. sold the Reno parcel to Golden Gaming last year "after having the property on the market for close to a year and seeing limited buying interest," Bear Stearns & Co. bond analyst John Mulkey said in a research note to investors.

Independent directors unanimously approved the purchase and the price is supported by an independent appraisal, the proxy said.

Station Chief Financial Officer Glenn Christenson said Monday the company hasn't yet decided whether it will develop the land or hold it as an investment.

"We obviously like investing in land in Nevada," Christenson said. "It's a good investment for shareholders."

The land is located in a rapidly growing part of town, he said.

Mulkey called the land "a nice asset for Station in the longer term" and said the company isn't expected to seek any development on the site before 2007.

Similar to Las Vegas, Reno restricts locals casinos to specific zones, "which supports the decision by Station to secure a spot now and wait for the market to mature," Mulkey said.

The locals casino market in Reno is "developing rapidly" and Station would be a "formidable competitor" given its track record in Las Vegas developing neighborhood casinos with entertainment venues, he said.

The company holds the largest off-Strip market share with nine big neighborhood casinos as well as smaller locals casinos.

Station Purchases Reno Land is republished from Online.CasinoCity.com.