Lorenzo Fertitta: Yes. This is Lorenzo. I’ll take a stab at that. As far as what we’ve learned after a few months of being open here, I think the biggest change potentially of what we thought prior to opening is that we need to solve for some additional parking before we get — necessarily get into the Phase II, what we had originally planned, which is a good thing, by the way. we kind of use all of our historical metrics and what we had historically seen. The volumes at peak period of Durango primarily partly driven by the success of the food hall and so were other restaurant offerings, we just need more parking. So we’re working on a sale for that because we don’t want to completely rip up the parking lot and do an expansion at the same time.
So we’re trying to figure out timing on that. Relative to the success we have had on the food and beverage side, I think where we are is we want to just focus on what we think we do really well, which is run slot machines and table games and hotels and led expert to run restaurants, kind of run the restaurants. It’s I think allows us to drive higher-margin business overall throughout the portfolio. And as we’ve learned from doing this for 35 years or however long it’s been, restaurants are very difficult to run, and it’s very challenging. And if we can find great operators to bring in and we’re so focused, we’d much prefer to do that.
Scott Kreeger: And Brad, just one kind of note. The F&B line item that you’re seeing in the press release, that’s our own and managed restaurants. The lease revenue that Lorenzo spoke to is going to fall in the other category.
Operator: [Operator Instructions]. The next question comes from Joe Stauff with CIG.
Joe Stauff: I wanted to ask just maybe a broader question just on the locals market and all the migration and most of the migration coming from California and so forth. You’re spending a lot of capital to build and expand sort of a premium product in the market. I think most of us understand what Boyd is doing. I wonder if you can comment on other competitors in the market. And are they trying to match you? Or are they staying with more low-cost model in terms of their approach in the Las Vegas market — Las Vegas locals market. And then, I wanted to ask, just specifically, you had a reference in one of your slides regarding Durango at $180 million plus. Does that imply that whether it be the parking lot and the expansion you’re thinking about $100 million of capital invested at some point as you kind of greenlight those projects?
Stephen Cootey: Yes, I think what you’re talking about is the land side, and that was really just to show that the value creation that we get by purchasing rod dirt. And so — as Frank and Lorenzo always said, well, we tend to get our greenfield return within 3 years. These assets don’t stop at year 3, they continue to grow. So we just want to provide a metric to show that we plan to grow this asset beyond that 20% ROI.
Frank Fertitta: We’re basically trying to demonstrate the value of the gaming entitled Real Estate portfolio by developing projects.
Stephen Cootey: But it doesn’t include the garage. But Joe, it does kind of lead into — that slide is probably a good segue into really your first question. I can’t really comment on what other competitors are doing, but we know what we’re doing. Franklin runs for 40-plus years is focused on delivering the best-in-class assets and most importantly, the best-in-class locations. We live in a very regulated market. The local market is protected by SB208 which restricts the amount of gaming and title land that can come off the strip. And fortunately, and I think to these guys credit over the past 40 years, they’ve bought up pretty much every piece of gaming and title land that comes available. And then no different — and this is something that’s built into our DNA, our Sky Cayan purchase and our Lose purchases.
We continue to look for gaming title land that we view as potential developable resorts down in the future. So that’s where it starts from us, and that’s really where it ends. So locations, it’s tough to repeat a location. There’s only one — once it’s gone, it’s gone. And right now, we feel we have the best of the 6 available.
Lorenzo Fertitta: Yes, that’s part of the value in the platform, right, is having the best locations and trying to project out where growth is going to happen, where the city’s dynamics from a demographic standpoint are going to change over time and trying to be ahead 10, 20 years so that we’re positioned. And I think that as we started really thinking about this in the late ’90s, that’s starting to pay off here kind of 20, 25 years later. We’re starting to see the benefit of that. And that’s why we’re able to develop something like Durango get outsized returns. And I think part of the reason for the deck that Steve had put together, as Frank mentioned, was just — I think a lot of people think about our company say they have 500 acres of additional land, let’s put a value per 300,000-acre $500,000 an acre.
