Macquarie Securities gaming analyst Joel Simkins believes Pinnacle Entertainment should move forward with a planned gaming development in Lake Charles, La.
Las Vegas-based Pinnacle already operates L’Auberge du Lac in Lake Charles and has proposed the $407 million Sugarcane Bay on neighboring land.
Simkins believes the two resort-complex, which would surround a Tom Fazio-designed golf course, could grow the Lake Charles market into a nearly $2 billion-a-year gaming destination.
The L'Auberge/Sugarcane Bay complex could give Pinnacle one of the largest commercial casino facilities in Louisiana with 1,395 hotel rooms, 3,100 slot machines and 112 table games.
Houston, four hours to the west with 5.6 million residents, is the prime feeder market for Pinnacle’s Lake Charles complex.
“A larger, fully integrated resort with luxury hotel rooms, more meeting space, and other amenities could better attract Houstonians and other longer-range communities (such as Austin and San Antonio),” Simkins told investors.
One of the keys to the project is Texas not moving forward with legalizing casinos.
“We are comfortable that Pinnacle should move ahead with this project as the core Houston feeder market is underserved,” Simkins said.
Pinnacle also owns land in Reno, Atlantic City and Baton Rouge, La., for potential casino development. The company is planning to open a second casino in St. Louis next spring with construction of Sugarcane Bay expected to follow.
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