Confirmation of the deal
The San Manuel Band of Mission Indians is set to buy the Palms Casino Resort in Las Vegas for $650m. Red Rock Resorts, the parent company of Station Casinos, confirmed the sale agreement on Tuesday morning. A new entity called the San Manuel Gaming and Hospital Authority will reportedly be in charge of operating the Las Vegas casino resort.
As per the sale agreement, $28.5m will get added to the price if the deal does not close within 18 months. The sale will need to get approval from the Nevada Gaming Commission and is set to close before the end of 2021.
the Palms is a casino resort that many of San Manuel Casino’s loyal guests would enjoy”
Speaking about the purchase, San Manuel Gaming and Hospitality Authority chairperson Latisha Casas said: “Our board believes that the Palms is a casino resort that many of San Manuel Casino’s loyal guests would enjoy. We are excited to move forward with this transaction.”
Recent history of the property
Station Casinos bought the Palms Casino Resort for $312.5m in 2016 from the Maloof family, who originally opened it in November 2001. The casino company then sunk $690m into renovating the property, including improvements to the hotel and the opening of a new large nightclub called KAOS. Following the renovations, the property reopened for business in April 2019. The nightclub then shut down after only a few months in operation, reportedly due to the high costs.
The property has a 94,840 square foot casino floor, numerous dining options, convention and meetings space, spa, pool, and a 2,500-seat theatre.
The Palms remains closed
The off-Strip Palms has not reopened since the COVID-19 pandemic caused state-wide casino closures in March 2020. This is despite Nevada casinos initially getting the green light to start reopening last June, albeit at reduced capacity.
Since then, the Nevada authorities have gradually eased restrictions on casinos. Wynn Resorts announced on Monday that its Las Vegas properties have gotten the all-clear to open at 100% capacity.
Of the many casinos that Station Casinos has in Nevada, it has not reopened three of them to date. In addition to the Palms, Fiesta Rancho and Fiesta Henderson remain closed and the company has not revealed any immediate plans to reopen them. In August 2020, Red Rock Resorts CEO Frank Fertitta III revealed that these properties might never reopen.
The tribe’s gaming sector presence
The San Manuel Band of Mission Indians currently operates a number of hotels around California. Its standout property is the San Manuel Casino in Highland, California, about 70 miles from downtown Los Angeles. It is one of the state’s most successful casinos.
In 2020, the tribe donated $9m to the University of Nevada Las Vegas. The funds went toward providing support for innovation and education regarding tribal gaming operations and law. Before entering the deal to purchase the Palms Casino Resort, the tribe already had sponsorship deals in place with the Las Vegas Raiders, Vegas Golden Knights, and Allegiant Stadium.
San Manuel won’t be the first tribe to get involved in the Las Vegas casino market in 2021. Mohegan Gaming and Entertainment operates the new Virgin Hotels Las Vegas, which opened in March.