Josh Hirsberg: Yes, Carlo. So it’s a good question. I think – look, I don’t think we feel like we’re going to have the direct impact as a result of the new competitor coming into the marketplace. And I think we believe that over time the market will absorb the new supply and kind of all boats will benefit from a rising tide. So I think that’s big picture, how we think about what’s going on, so there’ll be some kind of short to intermediate term pressure on our business. We’re not the direct impact of it. And then over time, the market just kind of grows through all of that. And I think that’s consistent with what we said in our market – in our prepared comments. When we think about the impacts to our business, I think we think of it primarily as Orleans, which is shortest by distance, but not necessarily a direct and easy drive from that asset to the property.
So that’s a consideration and then Suncoast on the other side of a major competitor here in Las Vegas. So I think if we think about kind of generally the impact to the business overall, it’s got to be kind of low to mid-single digits at most of the overall Las Vegas Locals segment. So we generate $450 million to $500 million of EBITDA. Kind of worst case, 5% would be up to $25 million EBITDA impact for all of next year. And I think that would be pretty conservative from our perspective.
Carlo Santarelli: Okay. Great. And then, Josh, if I could just kind of a follow-up on some of the comments you made earlier. You talked obviously about the cost increases. You guys walked through kind of the buckets where they were coming. You also made a point of, of kind of saying that 4Q, a lot of stability relative to 3Q. As you look out to 2024 and we think about those various buckets, obviously labor will be something that that likely persists. But how much kind of a headwind are you thinking about for 2024 as it pertains to kind of the cost side and some of the buckets that you mentioned?
Josh Hirsberg: Yes. So I think what we’re actually seeing is we kind of saw a pretty dramatic impact from expenses in 2022 and into 2023. And I think we’re starting to see a leveling off of those expenses to some degree. Not to say that they’re not going to increase or they’re not going away, but as I think about the expenses, like for instance, we’ve talked a lot about the minimum wage program we rolled out, middle of next year we’ll anniversary that program. Utilities that have been going up double digits, really, when you look at 2022 versus 2021 are now mid to high-single-digits and starting to be in the low-single-digits. So we’re starting to get to the point where they at least when we think about the major categories of expenses, they’re feeling like they’re starting to level off to some degree.
And a lot of this – some of this has to do with kind of how we think about managing the business going forward. Some of these things we don’t have much control over like property insurance rates or property taxes to some degree. But I think as we evaluate where the expenses kind of year-over-year are trending and we look at where we think in the near-term those expenses are going, which we don’t believe are changing materially. I think we feel like we’re moving into a period of expenses that will grow, but just be more stable overall for us, and we’ll be able to manage through it. I think what gets more difficult is the question of, if the consumer continues to get weaker. Now we haven’t seen that. We’re not seeing it at the retail level.
We’ve seen strength in the core customer. But I think what we’re trying to paint a picture of from what we see today is a fairly stable expense environment. There’s going to be nuances in seasonality and today currently at least a stable consumer environment. We’re going to have disruption with respect to Main Street Hotel that will continue into Q4. Once that’s all done, Downtown should be ready to run for 2024. We’ll have some disruption related to the introduction of the competitor, and we’ll have to work through that in Las Vegas locals through a period of 2024. But absent that, if you were able to kind of remove that impact in some way, I think you would have a business that has kind of very consistent performance with what we’re seeing today.
And then the Midwest and South also stable core customer, hopefully a retail customer that doesn’t show any further weakness going into 2024. And we kind of get beyond some of the construction that we felt at some of our assets in this quarter, so 2024 looks to be a stable year for us in the Midwest and South. But I don’t know, Keith, you want to add anything to that because I’ve tried to kind of give it a big broad brush. But Carlo, I hope that helps.
Carlo Santarelli: Absolutely. Thank you.
Josh Hirsberg: Yes.
David Strow: Thank you. Our next question comes from David Katz of Jefferies. David, please go ahead.
David Katz: Hi. Afternoon. Thanks for taking my question. If we could go in another direction, just talk online for a minute, obviously progressing nicely there. Just recalling what you spent on the acquisition, I believe it was about $125 million and then some other investments. Any color you can give us on where you think that might go or could go or payback period or ROI or any of that sort of vision would be helpful.
Keith Smith: Yes. So the acquisition of what then was Pala Interactive, which is now Boyd Interactive is moving along well. We relaunched the Stardust platform in Pennsylvania and New Jersey earlier this year, kind of beginning of May. And thus far, I’m very pleased with this performance. We bought the business and we chose to get more directly or directly involved in the online gaming business because it’s – we view it as a long-term play. This wasn’t about a short-term kind of IRR or ROI. This is really about kind of long-term controlling the journey of the customer having a holistic view of that customer and wanting to help build kind of another growth database and somebody we can market to. So we’re very happy with the early launches in Pennsylvania in the month of August, after just 90 days of being operating on the Stardust platform.
We’ve exceeded the highest iGaming or iCasino levels that FanDuel had done when they were running it for us, so we’re very happy with the performance, and it’s growing. But it’s early. And we’re not at a point of talking about returns on investment at this point, but it is a long-term play and something where – once again, we view it as an important part of a long-term strategy having both an online business as well as a strong land-based business to compete effectively.
David Katz: Understood. And with respect to the capital decisions you’re making for next year, I just wanted to get a sense for where the boundaries are, are things that are more larger or more transformative, I know of one company that’s up for sale that we’ve read about or strip investments and things like that? I just wanted to get a sense for how big we should think or should we just look at your portfolio and think about properties that may need some expansion or upgrade?
Keith Smith: Yes. I think when we were talking about capital investments, it was – as I think I discussed in my prepared remarks, it’s more about our maintenance capital budget and improving existing facilities, number one. So we’re going to open seven new restaurants in the fourth quarter this year across the country as a way to make sure that we have a fresh product for our customers. We’ve got several room remodels starting just because you need to do that. We’ll continue to through those types of programs through 2024. We’ll be opening another seven, eight new restaurants next year and have some more room remodels. We will look at, and we will announce later in the year kind of our next phase of you want to call it, expansion or growth capital programs like the Fremont, like Treasure Chest, we’re not ready to discuss those yet.
