Mississippi’s Rainbow Hotel & Casino Fetches $80M
- Jun 09, 2010
June 9, 2010
By Barbra Murray, Contributing Editor
Rainbow Hotel & Casino in Vicksburg, Miss., has officially come under new ownership with the closing of Las Vegas-headquartered Bally Technologies Inc.’s sale of the dockside riverboat gaming property to St. Louis, Mo.-based Isle of Capri Casinos Inc. Isle of Capri plunked down $80 million in cash for Rainbow Casino, which it will re-brand as a Lady Luck Casino.
Developed by Bally Technologies, Rainbow Casino first opened its doors in 1994. Today the property features the 89-room Rainbow Hotel, a 33,000-square-foot casino, a 20,000-square-foot conference center and 48,000 square feet of restaurant and administrative office space.
The sales volume in many sectors of the commercial real estate market has begun to pick up over the last few months, but it is still relatively sluggish in the casino property sector. There are two reasons for the limited amount of sales, Jacob Oberman, Director of Gaming Research and Analysis with CB Richard Ellis’s Global Gaming Group, told CPE. “First, most casinos in regional markets weathered the recession better than properties in markets like Las Vegas and Atlantic City, therefore they were able to refinance debt last year,” he said. “Second, while there are a few distressed properties out there, buyers can still only get a certain amount of debt for acquisitions, and often times, lenders aren’t willing to sell at certain prices. Because of the pricing stalemate, there haven’t been a lot of transactions.”
The Rainbow Casino transaction marks a big turning point for Bally Technologies, which focuses mainly on the designing, manufacturing, operation and distribution of advanced gaming devices and technology solutions worldwide. “With the sale of Rainbow Casino, we will no longer own and manage a casino property,” Laura Olson-Reyes, Director of Corporate Communications for Bally Technologies, told CPE. “We are very proud of the casino; however, we feel it is important to focus on our core business.” For Isle of Capri, the acquisition allows the company to reenter the Vicksburg market.