Wednesday, Aug. 6, 2008 | 12:39 p.m.
Pinnacle Entertainment said a new mega-casino it plans to build on the Boardwalk will have a "beach house" theme.
The Las Vegas-based company plans to hold onto its land on and near the Boardwalk until credit markets improve and it can build its mega-casino project, chairman Dan Lee said Wednesday.
The theme of the casino has been a closely held secret for nearly two years.
"We have a beach here, and that's something that distinguishes us from our competitors," company spokeswoman Pauline Yoshihashi said. "We think it's a great distinguishing factor for us."
The as yet unnamed $1.5 billion to $2 billion project on the site of the former Sands Casino Hotel has been on hold since February, and the company has floated the possibility of not building it at all if credit markets don't improve within the next year or two.
Pinnacle chairman Dan Lee said the company is prepared to "inch toward having a project that can be built when the capital markets improve."
He said design work is almost complete for the project, and the company recently has assembled more than $50 million worth of land in the area to expand its development site, bringing its total land acquisition costs there to about $360 million.
At this point, Pinnacle has most of the land it needs in the area, he said.
But the company can't start building it in the immediate future, he added.
"We can't finance this thing today, anyway," he said. "I don't think anybody can. We've gone into a little bit of a holding pattern."
Lee said expenses for holding the Atlantic City project, including local taxes and legal fees, will be affordable.
That will enable Pinnacle to "carry that land indefinitely while we wait for capital markets to improve so we can go ahead."
The company plans soon to approach restaurateurs and retailers who might be interested in locating in its new casino, Lee added.
His comments were more optimistic than those he made in May, when he estimated the odds of going ahead with the Atlantic City project at no better than 50-50.
The company demolished the Sands last fall, right around the time the economy took a turn for the worse and financing all but dried up.
The new project had originally been scheduled to open in 2011 or 2012, but that timetable could be pushed back.
Pinnacle on Tuesday reported a second-quarter loss of $18.1 million, or 30 cents a share, compared with a year-earlier profit of $9.9 million, or 16 cents a share.
Its stock was trading at $11.98 early Tuesday afternoon.
The company also disclosed that it had been considering buying Ameristar Casinos Inc. Starting last October, Pinnacle bought about $40 million of Ameristar stock. Since then, the stock is down about 60 percent, leading Pinnacle to scrap its plans to buy or merge with Ameristar, Lee said.
Pinnacle also plans to either sell or close The Casino at Emerald Bay, a small casino it operates in the Bahamas, Lee said.
