New Palms chief bullish on casino’s prospects
Joseph Magliarditi is bullish about the Palms. The president of the off-Strip resort said Tuesday the property has enjoyed a profitable last six months of 2011, even as the hotel finalized its new ownership structure.
"We’ve had very good run over the last six months from a financial aspect," Magliarditi said. "I think there is nothing like the city having some good news once in a while.
"We’ve seen not only increased revenues, but increased cash flow, particularly over the last six months in a year over year basis."
Magliarditi declined to release fourth quarter or 2011 revenue figures for the private gaming company. He said the property, which is now majority owned by two private investment firms, had seen double-digit increases in gaming revenues.
"We’ve seen increases in hotel revenues that are in line with what the city is seeing," he said. "From a cash flow perspective, over the last six months, we’ve practically doubled our cash flow."
For 2011, the company’s cash flow is up 60 percent to 70 percent, he said.
Not bad for his first six months on the job. Magliarditi was hired in June to replace Paul Pusateri, who resigned less than two years into the job and eight days after George Maloof announced his family had restructured its ownership debt in the resort.
Maloof now owns 2 percent of the hotel-casino. He turned over 98 percent of the Las Vegas celebrity hangout to the private investment firms TPG Capital and Leonard Green & Partners LP.
"Now that we are through the restructuring and we’ve seen all these positive results, we are starting to fill positions," Magliarditi said. "This year we are focusing on customer service."
Magliarditi said during the worst of the recession "everybody cut."
"I think any operator would have a difficult time saying it didn’t affect them from an operational standpoint," he said.
But has the Palms benefited from a general rebound in the Las Vegas gaming and tourism market or from the changes the resort has made itself?
"I think it’s a combination," he said. "We’ve seen … increases in the city like everyone else. Now that the restructuring is behind us we have a much more focused team. We’ve seen some uptick in our business.
"So I think there is some renewed focus on our part," he said. "I think we are a solid focused team right now and we are benefiting from it right now."
Magliarditi said the Palms now has the "opportunity to reinvest in the property."
That reinvestment began with a $5 million upgrade of the casino. The property purchased about 200 new slot machines, reconfigured the casino, plus created the Playboy Party Pit, which has six blackjack tables.
"We reconfigured our food and beverage program," he said. "We’ve hired a new culinary staff. We’ve improved the quality of the buffet. We are close to getting it to a point where we will implement a big marketing program around it."
Ghostbar Day Club has been a huge success, he said. The decision to open the club during the day was a way for the resort to carry pool revenue over during the winter months.
The company will spend $12 million to remodel more than 400 rooms by the end of the year. Other projects in 2012 include a complete remodeling of Rain nightclub and upgrades to the Playboy lounge.
Plans for a $20 million remodel of Rain are on the drawing board, he said.
Cantor Gaming is expected to break ground on a new sports book on April 1. He said the remodel also includes the bar adjacent to the sports book and possibly moving the poker room to an area next door that currently offers slot machines, he said.
"It’s a lot of good news," Magliarditi said. "Don’t get me wrong; we have plenty of work to do, but it’s good news."
Contact reporter Chris Sieroty at csieroty@reviewjournal.com or 702-477-3893.
