Mohegan Sun and Virgin are going to separate in Las Vegas
News was broken by a comedian, of all people:
https://twitter.com/funnykeithlyle/s...56578265821426
I saw this coming a mile away, and talked about it on my radio show many times.
This partnership was never going to work. The biggest problem was that the casino comps were not in synergy with the hotel/restaurants. Mohegan managed the casino, and handed out the comps. The comps (aside from the freeplay) were redeemed on the hotel side, owned by Virgin. Therefore, Mohegan had to transfer over real $$ to Virgin every time they handed out a comp. They weren't reimbursing them at retail rates, but that doesn't matter. It's still never going to work with this model.
Here's a simple example:
Say the player stays at Virgin on a comp offer from Mohegan during a normal Monday-Thursday. If Mohegan owned the entire property, this hotel comp would cost them almost zero money, as the room would otherwise be empty anyway, and the cost of cleaning/replacing supplies would be negligible. However, with Virgin owning it, Mohegan would have to pay Virgin some kind of nightly rate to put up the player, even if cheaper than retail.
This, in turn, caused Mohegan to become incredibly stingy with their food/hotel comps at Virgin, and in fact they were revoking them after-the-fact when people would check out -- something unheard of in Vegas, and probably not even legal.
This might still be able to fly if Virgin were a hot property located where the Aria or Cosmo sits. It doesn't work for an off-strip property with nothing interesting/special about it.
When you're #2, you try harder. If you start becoming player-unfriendly, as Mohegan did, you will lose the few people coming to your property. And that's what happened. The place was a freakin' ghost town.
Presumably the plan now is for Virgin to run the entire thing, and this idiotic partnership no longer standing in the way of success. The problem is that the time for this property to possibly succeed has come and gone. I don't see this situation turning around, even with the burdensome partnership gone.
