Publisher’s note: This article was originally published April 22, however, it contained some inaccuracies regarding the Tribe’s purchase and ownership of the properties. The revised article is below. We apologize for any inconvenience.
A previous failure didn’t stop the Laguna Development Corporation (LDC), a business corporation of the Laguna Pueblo Indian Tribe of New Mexico from pursuing opportunities in commercial gaming outside their state.
That bet has paid off and now LDC’s Ellis Entertainment LLC (Ellis Entertainment) is doubling down.
In 2019, Ellis Entertainment paid $11 million for Ellis Park horse track and gaming parlor in western Kentucky and reported a profit in 2021. Now, they’re planning to expand their operations in the state by opening a satellite facility in Owensboro, a metropolitan area of just under 120,000 some 40 minutes away from Henderson where the track is located.
It’s a deal that wouldn’t have happened if LDC had worried about its previous attempt to expand outside the state.
In 2017, LDC attempted to acquire the Isle of Capri Casino Hotel Lake Charles, but didn’t consummate the sale when it decided to withdraw its application.
Velasquez spoke about the Ellis Entertainment venture into commercial gaming at the Indian Gaming Tradeshow & Conference.
When Ellis Entertainment sought out the purchase in Kentucky, it did so under the auspices of a limited liability company in the state with a holding company in Delaware. Velasquez, LDC’s COO, and the general manager of New Mexico’s Dancing Eagle Casino are licensed through the Kentucky Horse Racing Commission.
“Although we lost money in the first deal,” Velasquez said. “We didn’t put our heads in the sand and give up. You can’t just stop. You have to learn your lessons and move forward to be able to diversify and create the necessary revenue for our community’s essential government services.”
With three casinos in New Mexico, a competitive market with 20 Indian casinos and five racinos in a population of two million, Velasquez said they needed to diversify their portfolio instead of just relying on the New Mexico market.
A lot of research and strategy went into the new venture and Ellis Entertainments saw both the potential and obstacles to overcome, Velasquez said.
Ellis Park, which turns 100 this year, was in poor condition and needed a refreshing, she said. And Ellis Entertainment didn’t have any experience with horse racing so it hired the best consultants to get it through the initial race seasons.
“There were challenges when we bought this property,” Velasquez said. “It had lost money since 2005, but we saw an opportunity to be successful with the racing license and historic horse racing machines in Kentucky.”
Ellis Entertainment spent over $3 million on renovations of the facility, whose closest competition, Bally’s in Evansville Indiana, a few miles away. It offers Class III type gaming, compared to Ellis Park’s 350 historical horse racing machines.
Ellis Entertainment looked at constructing another building with more machines but passed on that because of site issues. Instead, Ellis Entertainment is capitalizing on a law passed by the Kentucky Assembly during the pandemic that allows an additional gaming and parimutuel operation within 60 miles of the original site.
“We conducted a feasibility study for Owensboro and deemed it a great market for a satellite facility and (decided) not expand at Ellis Park,” Velasquez said. “It’s an exciting opportunity in the fourth largest city in Kentucky and we have developed a great relationship with Owensboro officials.”
Instead of constructing a new facility, Ellis Entertainment signed a lease to move into and retrofit a former JC Penney building.
The facility, which has yet to be named, will start with 600 machines,
a sports bar and restaurant. Ellis Entertainment is allowed to have up to 2,000 machines.
“Our plan is to continue to grow,” Velasquez said. “Based on our initial financial projections we are anticipating a 100% return on investment in three years.”
Ellis Entertainment plans to put more money into racing purses and invest in the infrastructure at Ellis Park, and the success of their operation means more money for essential government services such as health care, education, natural resources and first responder funding in New Mexico, Velasquez said.
