he Nevada Gaming Control Board on Wednesday unanimously recommended a preliminary finding of suitability for two executives of Rio All-Suite Hotel & Casino's new owner, Dreamscape Companies. The recommendation for Eric Birnbaum and Thomas Ellis will go to the Nevada Gaming Commission for final approval on January 21.
Dreamscape plans to begin operating the off-Strip property within the next two years, and Birnbaum said it would get “a monster refresh" once that happens. The company currently owns the property that is managed by Caesars Entertainment. The Rio reopened on December 22 after it had been closed since March due to the pandemic.
Dreamscape announced that it had acquired the Rio for $516.3 million in September 2019. Per the purchase agreement, Caesars would manage the property for two years and pay $45 million in annualized rent. There’s an option for a one-year lease extension that would cost Dreamscape $7 million. Caesars retained the rights to the World Series of Poker, a staple at the Rio since 2005.
In his testimony before the Gaming Control Board on Wednesday, Birnbaum dismissed reports that the Rio’s 90-acre campus that includes 22 acres of unused property would be developed into a major league baseball stadium in a bid to attract a franchise to Southern Nevada, as reported by Las Vegas Review-Journal.
In addition, Birnbaum told board members that the ongoing pandemic has slowed his company’s plans to move quickly on upgrading the Rio. He said he has enlisted the help of Cosmopolitan of Las Vegas CEO Bill McBeath as a consultant on gaming matters.
Birnbaum said he hopes his company takes over the property before 2023. Once that happens, he said he expects Texas-based Aimbridge Hospitality “to have an active role in running the hotel.” By that time, Birnbaum and Ellis will be required to apply for a more thorough finding of suitability. Birnbaum said the biggest challenge will be matching property amenities to its anticipated customer profile. “We’re not the Wynn. We’re not Cosmo. We’re not the high end,” he said. “But we’re not the low end. We equate it to approachable luxury. You get good value for what you’re getting and it’s a good experience at a price point that you don’t feel you’re getting taken advantage of.”
The executive believes his company will have an advantage in that it will be able to focus 100% on the Rio while the property was one of many in the Caesars portfolio. He also anticipates a strong rebound for the Rio and for Las Vegas once the effects of the pandemic are over. “Our view is that there is going to be a vaccine and as a result, there’s going to be a lot of pent-up demand that is forthcoming,” Birnbaum said. “Our view — and we could be wrong — is that Vegas is poised to really benefit from that.”