(A family-owned company)
Clients were four brothers, each in different businesses and professions, who jointly owned a residential trailer-park in Louisiana, having only modest financial returns. They engaged Liuzza Management Consulting, ”LMC,” for ideas on alternative uses. LMC did a feasibility study on possible alternative uses including a commercial land lease. Upon completing the study, LMC’s recommendation was that a video poker truck stop casino was the highest and best use of the property. Louisiana, a few years earlier, had legalized video poker gaming in bars, restaurants, and truck stops. Since Liuzza already had varied experiences in the video poker business and its complex regulatory process, LMC was engaged to spearhead bringing this project to fruition.
The gaming regulations for a truck stop casino required the facility to include, in addition to fuel and related sales and ample parking for numerous. 18-wheelers, a restaurant, and a convenience food store. Since none of the brothers had the experience, time, or interest in overseeing this project in its construction or later operation, the first option that LMC recommend was a joint venture with an existing casino truck stop operator, who would contribute 50% of the capital, and receive 50% of the profits plus a management fee. Negotiations were held with two different parties, but neither could agree with the owners on the value of the real estate they the brothers contributed.
So, the final arrangement was to find and contract with an existing licensed gaming operator to manage and fund the video poker operation for a percent of the gaming profits. And the owners would lease out the restaurant, C-store, and fuel portions to separate parties. One of the brothers would be responsible for overseeing the gaming operator and the long-term leasing of the other entities.
LMC also sourced the design, permitting, engineering and construction of the new buildings and the other legal services required locally. The next phase was coordinating the complex licensing for the gaming operation and having each of the four owners approved for suitability by the Louisiana State Police.
Amongst the elements of this transformational process that LMC spearheaded, working closely with and on behalf the owners, were:
- finding existing truck stop operators appropriate for and interested in partnering with the brothers,
- finding and engaging the architect and engineers to design the project,
- finding the general contractor for constructing the entire complex,
- finding and negotiating leases with fuel, C-store, restaurant, and casino management tenants,
- zoning and Permitting requirements,
- appropriate local legal representation,
- licensing with LA State Police for video poker gaming operation,
- certification of Suitability of each individual owner,
- at the legislative level, led efforts to stop out-of-state investors from changing state law to allow internet linking of all video-poker players to large casino operators.
RESULT: a minimally profitable residential trailer park was transformed into a highly profitable video poker casino.
