PA casinos, what is in the future
PA is building it's last casino in the South Side Sports Complex, but it is only 5 miles from sugarhouse Casino, and only 10 miles from Harrah's Philadelphia, which is the casino in PA that peaked the earliest, and has had revenue drop the most. So it is not clear how much more tax revenue this new casino will bring to the state, and how much it will steal from existing casinos.
What happens? Does PA go into stasis for decades?
Quote: pacomartin
What happens? Does PA go into statiis for decades?
What happens is what has happened, casinos here are just part of everyday life and no longer a "special" place to go. It is all just normal and routine. The marketing departments need to actually come up with creative ideas. The state needs to consider lowering its 55% take on slot revenue that would embarrass even the mafia so that payouts can be raised and people will get more play for their dollar. The entertainment departments are going to need to book more acts.
But in the end, all involved need to realize that things were bound to level off.
Quote: AZDuffmanThe marketing departments need to actually come up with creative ideas. The state needs to consider lowering its 55% take on slot revenue that would embarrass even the mafia so that payouts can be raised and people will get more play for their dollar. The entertainment departments are going to need to book more acts.
Great points, right on target. I would go back to PA, but an incentive would certainly help my motivation. Where are the decent hotel rates ?
Quote: AZDuffman
But in the end, all involved need to realize that things were bound to level off.
Exactly. And add in the competition from Ohio, which would at least effect Western PA.
Quote: JohnnyQGreat points, right on target. I would go back to PA, but an incentive would certainly help my motivation. Where are the decent hotel rates ?
It depend. Nemacolin Woodlands is very, very high end though you may find a sale if you go mid-week when there is no convention there, however there is zero nearby as an alternative except maybe one or two of the kind of motels you used to see on Route 66. Rivers might have good deals if there is no sports or conventions. Meadows just and I mean just now completed the bridge to the connected hotel with a few others nearby, for them I would use priceline.
Quote:Exactly. And add in the competition from Ohio, which would at least effect Western PA.
Not sure how much that will affect things, though it might. I occasionally go to Wheeling for both a change and I feel the poker room is softer. Ohio might draw the folks north of Pittsburgh to Meadville.
Quote: pacomartinSlot revenue peaked in Sep 2012. Table games keep going up year after year as they steal patrons from NYC and northern NJ, but that may change if New York gets real table games or NJ finally gives up on Atlantic City.
PA is building it's last casino in the South Side Sports Complex, but it is only 5 miles from sugarhouse Casino, and only 10 miles from Harrah's Philadelphia, which is the casino in PA that peaked the earliest, and has had revenue drop the most. So it is not clear how much more tax revenue this new casino will bring to the state, and how much it will steal from existing casinos.
What happens? Does PA go into statiis for decades?
At think at some point the market will reach an equilibrium, and more or less stay there until some major event changes the competitive landscape. We are getting close to a settling of the market all ready. AC is what it is now (half of what it was before). PA is settling in. The new Philly casino will just cannibalize the three all ready in the market. MD and DE have their casinos in place (with the exception of the one in PG county outside DC) and they aren't going to effect PA much. So in summary, where are PA casinos going? The answer is; no where special. It is what it is. They'll plug along for the foreseeable future, and crank out some tax dollars for the state. Barring major expansion in NY...or the complete collapse of AC I don't know what would move the needle much.
Quote: zoobrewThe obvious next big needle mover would be if sports betting was legalized nation wide. It would be a battle royal between the Rivers and the Rooneys.
Please oh please let them put in a sports book! Was only in Vegas once on a football sunday, but it was just awesome! Football coming on at 10:00 AM helped for early-risers like myself, but I think the place would pack and their bar business would be way up.
STFRF. Let Dan go hang with his buddy Obama and tell the NFL that there is zero difference between "fantasy football" and rooting for a point spread.
Quote: vendman1At think at some point the market will reach an equilibrium, and more or less stay there until some major event changes the competitive landscape.
It's like the famous June 20, 1955 Life Magazine cover which asked "Las Vegas - Is Boom Overextended"
The State of PA is about to finish it's tenth year of gaming. Slot revenue in year 9 compared to the maximum year revenue for years 1-9 is as follow.
The original vision of "simple slot clubs" would have peaked in revenue sometime after year seven.
With only 4 years of table games to compare, most casinos have had their peak revenue in the 4th year with Presque Isle in Erie the only notable exception. However, there is a presumption that casinos would be more concerned about growing table game revenue which is taxed at 12% instead of slot revenue which is taxed at over 50%.
| PA Casino | SLOTS | TABLE GAMES |
|---|---|---|
| Harrah's Philadelphia | -34.2% | -7% |
| Presque Isle | -27.3% | -42% |
| Mount Airy | -21.8% | 0% |
| The Meadows | -16.5% | -17% |
| Penn National | -13.5% | -12% |
| parx | -8.6% | 0% |
| Mohegan Sun | -8.3% | 0% |
| SugarHouse | -7.4% | 0% |
| Statewide | -6.3% | 0% |
| Sands Bethlehem | -3.6% | 0% |
| The Rivers | -2.2% | -2% |
| Valley Forge | 0.0% | 0% |
| Nemacolin | 0.0% | 0% |
Table game revenue is driven primarily by visitors from other states. The majority of New Jersey residents are a closer drive to a PA casino than Atlantic City.
Harrah's Philadelphia, Presque Isle, and Mount Airy are considered by some people to be outright failures
Quote: pacomartin
The State of PA is about to finish it's tenth year of gaming. Slot revenue in year 9 compared to the maximum year revenue for years 1-9 is as follow.
SLOT MACHINE REVENUE LAST YEAR COMPARED TO PEAK YEAR
-27.3% Presque Isle RACINO
-2.2% The Rivers
Harrah's Philadelphia, Presque Isle, and Mount Airy are considered by some people to be outright failures
I was hoping that competition would help the consumer with better promo's, payback tables, etc. I'm not sure that it has, at least not as far as I can see. But it's all relative.
Quote: JohnnyQI was hoping that competition would help the consumer with better promo's, payback tables, etc. I'm not sure that it has, at least not as far as I can see. But it's all relative.
Upping payback is tough when your "partner" takes so much of the net. As to promos, comps are pretty low. But I think all casinos are trying to snuff out the idea of comps everywhere. Comps worked when Vegas was something special, now with Joe Sixpack turtling his slot play to get free drinks not so much.
This is not an issue in many states (no free drinks).Quote: AZDuffmanComps worked when Vegas was something special, now with Joe Sixpack turtling his slot play to get free drinks not so much.
Quote: pacomartin
PA Casino SLOTS TABLE GAMES Harrah's Philadelphia -34.2% -7% Presque Isle -27.3% -42% Mount Airy -21.8% 0% The Meadows -16.5% -17% Penn National -13.5% -12% parx -8.6% 0% Mohegan Sun -8.3% 0% SugarHouse -7.4% 0% Statewide -6.3% 0% Sands Bethlehem -3.6% 0% The Rivers -2.2% -2% Valley Forge 0.0% 0% Nemacolin 0.0% 0%
What is this a table of? I can't make sense of the 0%'s.
*edit* Ok, I see now, the explanation was worded a little funny. I would expect a downturn in revenue after an initial boom from a casino opening, and in the economic situation we find ourselves in. I'd say more of this has to do with non-casino related economic factors than it does with the casinos and their policies.
Quote: AZDuffmanWhat happens is what has happened, casinos here are just part of everyday life and no longer a "special" place to go. It is all just normal and routine.
Yup. For decades going to Vegas was a big
deal. In the last 5 years, I can make a short
drive and I'm in a Vegas style casino. It's
about as thrilling as going to Walmart.
Quote: EvenBobYup. For decades going to Vegas was a big
deal. In the last 5 years, I can make a short
drive and I'm in a Vegas style casino. It's
about as thrilling as going to Walmart.
Go see the Big 6 wheel, you will think WMT had a field trip for their various customers of the month.....
Quote: surrender88sWhat is this a table of? I can't make sense of the 0%'s
Slots + Table Games for Harrah's Phladelphia in millions $
$127 + $0.0 : FY 2006/2007
$333 + $0.0 : FY 2007/2008 == peak slots
$320 + $0.0 : FY 2008/2009
$307 + $0.0 : FY 2009/2010
$280 + $70.9 : FY 2010/2011
$264 + $80.5 : FY 2011/2012 == peak table games
$250 + $80.3 : FY 2012/2013
$219 + $74.5 : FY 2013/2014
I was trying to rank the casinos without showing all the data. Harrah's Philadelphia is in a high crime rate city where people dont want to go. Slots revenue peaked in the second year and is now down 34%. Table game revenue peaked in the second year when table games were allowed, and is now down 7%.
0% means the final year is the largest.
Quote: surrender88sI would expect a downturn in revenue after an initial boom from a casino opening, and in the economic situation we find ourselves in. I'd say more of this has to do with non-casino related economic factors than it does with the casinos and their policies.
I don't think it is tied into the general economy. A lot depends on how well you can attract out of state visitors. I assume Presque Isle in Erie tumbled when Ohio legalized gambling. Sands Bethlehem does very well because most of their patrons are from NYC and northern NJ.
Quote: pacomartin
Harrah's Philadelphia is in a high crime rate city where people dont want to go.
I think I was there once. Is that the one that's next to the prison? That place is massive. but seriously, wtf, next to a prison!?
Quote: AvincowI think I was there once. Is that the one that's next to the prison? That place is massive. but seriously, wtf, next to a prison!?
Greektown in Detroit is 2 blocks from the Wayne county jail.
Quote: IbeatyouracesGreektown in Detroit is 2 blocks from the Wayne county jail.
and the main police station... which of those two should one fear the most
Regards
Walter Budzyn and Larry Nevers
Quote: AvincowI think I was there once. Is that the one that's next to the prison? That place is massive. but seriously, wtf, next to a prison!?
Yes, it is right next to the prison. Chester (a small town) has one of the highest murder rates in Pennsylavnia. It was ranked the most dangerous city in PA
Murder rates in Chester by Year
Murders 2000-2012 (per 100,000) population 34,000
18 (43.8)
12 (32.4)
19 (51.2)
15 (40.6)
18 (48.5)
27 (73.4)
17 (46.4)
14 (38.3)
24 (64.3)
21 (61.6)
22 (64.3)
Despite the Murder rate in Chester, Harrah's started out very strong. In 2009/10 (the last year there was only slots), revenue before taxes per casino in millions. Sheldon Adelson was publicly announcing that he would have never started Sands Bethlehem if he knew that he was going to win the big licenses in Macao and in Singapore.
$381.65 parx
$306.76 Harrah's Philadelphia
$261.07 The Meadows
$246.99 Penn National
$240.18 Sands Bethlehem <--- Fifth place their first year of full operation (slots only)
$222.59 Mohegan Sun
$195.46 The Rivers
$164.70 Presque Isle
$145.44 Mount Airy
Four years later, Sands Bethlehem was the highest grossing casino in PA after taxes thanks to the huge revenue they make in table games which is taxed at a much lower rte than slots.
Quote: coilmanand the main police station... which of those two should one fear the most
Regards
Walter Budzyn and Larry Nevers
The police HQ moved to the building that was the temporary MGM casino. So that is just across Michigan Avenue from the current MGM.
Sands Bethlehem, Sugarhouse, and Valley Forge in particular now are making half their money after taxes on table game
PA is not done growing. The Live! Hotel & Casino project, in the Southside sports complex should be a big hit. As long as NJ keeps gaming in Atlantic City, the PA casinos can easily feed off NJ citizens who don't have the time to travel to Atlantic city.
But PA has only two or three years of growth left. Will it be satisifed with meeting original objectives? I think the answer is no.
2013/14 After Tax Revenue in $ Millions (% table games)
EASTERN PA
$283 Sands Bethlehem 54%
$270 parx 39%
$165 Harrah's Philadelphia 38%
$155 SugarHouse 47%
$140 Mohegan Sun 27%
$130 Penn National 23%
$102 Mount Airy 35%
$60 Valley Forge 47%
WESTERN PA
$188 The Rivers 31%
$128 The Meadows 20%
$68 Presque Isle 16%
$15 Nemacolin 27%
$1,705 Statewide PA 37%
Even though Presque Isles is a full size casino in Eries with 1600 machines, and Valley Forge is restricted to 600 machines, because table games are so much higher in VF, they are behind this year by only 4.5% in after tax revenue.
The article also had this tidbit. During the 75-minute hearing at the casino, Rivers officials argued against the issuance of any more resort casino licenses while backing efforts to allow Internet gambling as well as fantasy sports and skill-based games in state casinos.
http://www.post-gazette.com/business/pittsburgh-company-news/2015/05/21/Slot-machines-could-be-heading-to-Pennsylvania-international-airports/stories/201505210111
Now, we all know Meadows sucks in general, but people like to go to suburban slot barns instead of downtown casinos. Rivers must have been doing something right.
Quote: teddyspeople like to go to suburban slot barns instead of downtown casinos. Rivers must have been doing something right.
I think that there are just not that many people within driving distance of The Meadows compared to downtown Pittsburgh,
Since PA casinos pay such a dramatically smaller tax percentage on table games than slots, the money making casinos are the ones that are pulling in a proportionately larger share of table game revenue. Sands Bethlehem is the only one that makes more money (after tax) on table games since it is doing so well in bringing in the NJ and NYC residents.
The more urban casinos and the ones near the NJ border are much higher on the list as to the share they owe to table games.
2013/14 After Tax Revenue(% table games)
53.9% Sands Bethlehem
47.4% SugarHouse
47.3% Valley Forge
38.9% parx
38.4% Harrah's Philadelphia
35.5% Mount Airy
31.3% The Rivers
27.4% Mohegan Sun
27.2% Nemacolin
22.7% Penn National
20.1% The Meadows
15.7% Presque Isle
....
36.7% Statewide PA
Sample Calculation
Sands Bethlehem had
gross revenue of $280.4 million in slots, but they got to keep $130.5 million after taxes.
gross revenue of $177.2 million in table, but they got to keep $152.4 million after taxes.
So 53.9% of after tax revenue was from table games.
CY 2014
$209,561,815 Borgata
$119,977,272 Ceasars
$92,119,539 Harrah's
$74,578,853 Bally
$55,934,907 Taj Mahal
$53,617,131 Tropicana
$46,427,593 Golden Nugget
$29,167,535 Resorts
$681,384,645
If Borgata drops 5% this year, and Sands Bethlehem PA keeps with it's 13% increase , then even that superlative will end.
Bethlehem Sands is now challenging Borgata as an entertainment venue, but it is very unlikely that it will expand in hotel rooms to beat Borgata in conventions and in destinations for events like weddings.
Quote: pacomartinUntil the recent shutdown in Atlantic City, NJ still exceeded PA in table game revenue. Now the sole remaining statistic that NJ has over PA is that the Borgata has the largest share of table game revenue for a single resort.
CY 2014
$209,561,815 Borgata
$119,977,272 Ceasars
$92,119,539 Harrah's
$74,578,853 Bally
$55,934,907 Taj Mahal
$53,617,131 Tropicana
$46,427,593 Golden Nugget
$29,167,535 Resorts
$681,384,645
If Borgata drops 5% this year, and Sands Bethlehem PA keeps with it's 13% increase , then even that superlative will end.
Bethlehem Sands is now challenging Borgata as an entertainment venue, but it is very unlikely that it will expand in hotel rooms to beat Borgata in conventions and in destinations for events like weddings.
I'd rather be Borgata than Sands any day. B will long be the number 1 destination casino resort in south Jersey and Philly. Sands will take a major, major tumble with real NY casinos and north Jersey casinos.
Quote: onenickelmiracleI can't see any effort possible to increase revenue through value and volume, so they'll stay short term. Taxes seem moot considering nearby states offer comparable payouts with lower taxes. Nickel and diming on stupid things nongaming in Pa. drove me away pretty much. So basically the plans are business as usual seeking easy money only. They'll stay open no problem.
It is a lot of business' attitudes not just gaming. Gaming in the northeast has now shown the habit of riding on previous coattails.
Quote: teddysI'm surprised Rivers overtook and surpassed Meadows fairly quickly.
Now, we all know Meadows sucks in general, but people like to go to suburban slot barns instead of downtown casinos. Rivers must have been doing something right.
Rivers said from the get-go that they wanted to go for the higher roller. Rivers has good parking and is nice and close for Steeler and Pirate games. Free shuttle from downtown to get the after-work crowd. I like Rivers better and it is closer to my place to boot. Rivers is just a step above.
Quote: AZDuffmanRivers said from the get-go that they wanted to go for the higher roller. Rivers has good parking and is nice and close for Steeler and Pirate games. Free shuttle from downtown to get the after-work crowd. I like Rivers better and it is closer to my place to boot. Rivers is just a step above.
In slot selection and entertainment the Meadows is better than the Rivers, but the Rivers has the downtown area to provide other entertainment choices. It would be great if either casino offered their own hotel for comps and were part of a better national casino network.
Quote: zoobrewIn slot selection and entertainment the Meadows is better than the Rivers, but the Rivers has the downtown area to provide other entertainment choices. It would be great if either casino offered their own hotel for comps and were part of a better national casino network.
Actually I like them not having hotels. Makes them more user-friendly.
Quote: AZDuffmanActually I like them not having hotels. Makes them more user-friendly.
Sands Bethlehem has occupancy of 84.5% at an average daily room rate (ADR) of $149.
The occupancy rate us jumped 34% over the first quarter of the last four years, so they may add another tower.
84.5% $149
68.8% $146
65.3% $138
50.3% $139
There are two other hotels within three miles but the are pretty busy also.
302 rooms Sands Bethlehem
124 rooms Comfort Suites Lehigh University
80 rooms Holiday Inn Express Interstate
Perhaps a Hampton Inn might help.
Quote: pacomartin
Perhaps a Hampton Inn might help.
On the way for Meadows, to go with the now-connected Hyatt.
I'm pretty excited to see it. I don't remember ever being in a Hyatt Place built from scatch. They were all Summerfield Suites or whatever before (converted).Quote: AZDuffmanOn the way for Meadows, to go with the now-connected Hyatt.
Quote: pacomartinSlot revenue peaked in Sep 2012. Table games keep going up year after year as they steal patrons from NYC and northern NJ, but that may change if New York gets real table games or NJ finally gives up on Atlantic City.
With only 1 month left in this fiscal year (June) slot revenue is slightly up 0.51% YoY compared to last year. Without the mini casinos it would still be down.
Slot revenue year over year for 11 months of this fiscal year
-6.05% Presque Isle
-3.40% The Meadows
-3.22% Mohegan Sun
-0.79% Mount Airy
-0.79% Penn National
-0.19% The Rivers
-0.16% Harrah's Philadelphia
0.06% SugarHouse
2.77% Sands Bethlehem
4.28% Parx
12.72% Valley Forge MINI CASINO
25.23% Nemacolin MINI CASINO
The legislature is considering options to increase gambling. Sands casino manager objects to all proposals. Most other casino owners are in favor of internet options. Everyone hates the ideas of limited gaming licenses for bars.
One option is to allow alcohol for 24 hours for $5 million per casino.
Quote: GWAEDoes anyone know how the Meadows can give away free alcohol? As far as I know they are the only one in PA that does while playing. I thought it was against their license or against their liquor license to do so. A floor person told me it is because the casino is actually paying for it and not just giving it away. I assume that means it appears differently on thir P/L than it would if they just gave it away. Of course his opinion on how they do it is probably wrong but I have been curious. Any ideas?
Every casino I've been to in eastern PA has given me free booze. Parx, Sugarhouse, Harrah's, Valley Forge, Sands, Mt Airy. I would guess that every casino could if they wanted to. The ones that don't are probably just cheap.
Quote: GWAEDoes anyone know how the Meadows can give away free alcohol? As far as I know they are the only one in PA that does while playing. I thought it was against their license or against their liquor license to do so. A floor person told me it is because the casino is actually paying for it and not just giving it away. I assume that means it appears differently on thir P/L than it would if they just gave it away. Of course his opinion on how they do it is probably wrong but I have been curious. Any ideas?
No idea but even though I did not partake it was nice to hear they are offering it free even during a trourney. Weird for me I played thursday and no booze but friday they announced free booze.
From a 2006 Pittsburgh P-G article
He said The Meadows' pay-for-alcohol policy will be based in part on consideration for restaurants and taverns, which can't offer free drinks. He added, however, that in creating its list of player comps based on their volume of play and amount wagered, the racino might make cocktails a basic perk they could choose. The Meadows might also become more generous with alcohol to all players if competition from other casinos dictates it, Mr. Paulos said.
Quote: GWAEOf course his opinion on how they do it is probably wrong but I have been curious. Any ideas?
It's surprising how many people just make up answers. His opinion is not based on anything,
Casinos cannot serve alcohol between 2AM and 6AM. They are permitted to give away drinks at their own volition. As DUIs are up near casinos, I am sure that they are careful. PA is not NV and is historically extremely conservative about booze.
Of course the reason that DUIs are up is just because there is much more traffic after the casino opens.
Table games for first 10 months of this fiscal year
-11.02% HARRAH'S PHILADELPHIA
-8.05% VALLEYFORGE- mini casino
-0.29% PENN NATIONAL
-0.23% THE MEADOWS
4.39% THE RIVERS
4.95% MOUNT AIRY
8.13% PRESQUE ISLE
8.50% SUGARHOUSE
9.12% MOHEGAN SUN
10.71% PARX
13.08% SANDS BETHLEHEM
13.17% NEMACOLIN - mini casino
5.92% TOTAL
Table games are taxed at 1/4 the rate of slot machines.
Quote: rdw4potusWhat is the current license situation in PA? Does the new Philly location have the last available license?
There is a racino track license available that is meant for New Castle PA, but this project has been stuck in the financing stage for over 5 years and there are some vague threats that this license could move to another part of the state if the parties don't get their act together.
Quote: zoobrewThere is a racino track license available that is meant for New Castle PA, but this project has been stuck in the financing stage for over 5 years and there are some vague threats that this license could move to another part of the state if the parties don't get their act together.
Actually the law does limit it to one more racino and one more mini casino (after July 20, 2017).
Limits in 2004 Law.
There are currently 6 racing casinos, and the law limits it to 7 total. If New Castle crumbles than it can only be replaced with another racino (not a casino).
There are currently 4 standalone casinos, the Philly Sports casino will make 5 which is the legal limit.
There are currently 2 "resort" mini-casinos, Valley Forge and Nemacolin. The law limits it to a maximum of three
There are plans to build a racino in Austintown Ohio, only 35 miles from New Castle. With the 2012 opening of a casino in Cleveland, and the existing racino in Presque Isle, Erie PA. the market seems more than saturated. Presque Isle is the smallest of the full size casinos, and revenue is dropping rapidly and is expected to get worse with Austinland. Presque Isle may drop below Valley Forge mini casino. The addition of another racino in New Castle seems almost insane.
The mini casinos were supposed to bring high end tourism into the state. The model was Greenbrier in West Virginia. Nemacolin fits the bill as it is an ultra expensive golf resort. Valley Forge was controversial because although it is a convention center, it is also a suburban location. Many people felt that was not the true intent of the law.
