On August 8th, 2008, the organization headed by Chicago Billionaire Neil Bluhm is predicting that the North Shore Casino that he wants to take over will produced $427.8 million in revenue during its initial year of operation, more than $65 million than the amount that the Pennsylvania State Gaming Board is predicting for the casino. But the estimates of Pittsburgh Gaming Holdings, the organizations formed by Neil Bluhm to save the North Shore casino, are smaller than the gambling board financial suitability group estimates for the slots facility for the next four years.
By the fifth year, Pittsburgh Gaming is predicting that the revenues will be $100 million less-$507.4 million compared with the gambling board’s figure of $611.6 million, based on five thousand slot machines. The revenue estimates were released on the gambling board’s site. Pittsburgh Gambling is predicting an average slot machine wins of $361 million a day in the 1st year, based on an average of 3,250 slot machines.
The gambling board estimated an average of $306 a day, based on the same number of slot machines. It is not yet known why the two estimates are different. The gambling board said that all of the estimates were based on 2009 dollars.
The bigger estimated revenues in the first year could help Mr. Bluhm’s organization with Wall Street and in its financing. Rating agencies had expressed concern about the amount of credit involved in the $800 million project and whether the casino would be able to produce enough revenue to meet their obligation.
As part of their takeover plan, Mr. Bluhm’s organization is planning to invest $170 million in equity in the casino project. Don Barden, who was unable to secure enough financing for the project, was planning to borrow all of the money needed for the casino.
The Pennsylvania Gambling Board’s financial suitability task force had estimated in 2006 that the Pittsburgh casino would produce $482.8 million in its stabilized year, but those estimates were based on 2005 dollars.