In the 36th year of casino gambling in New Jersey, which not too long ago had a monopoly on the East Coast, the casino industry is crashing with a suddenness and a fury that has caught many people here by surprise. It started the year with 12 casinos; by mid-September, it could have eight.While Ohio's casinos have been a giveaway to special interests (the writers of the ballot initiative, namely, Dan Gilbert and Penn National, and the horse tracks, now mainly owned by casino companies), I think we aren't as oversupplied as Atlantic City (now southeastern Indiana, on the other hand....), at least yet. It will be interesting to see what happens when the Dayton racino opens, which will provide southwestern Ohio and southeastern Indiana with the option of 4 casinos and 3 racinos, with the potential of another at Turfway Park if the horsemen (and Dan Gilbert) get their way in Kentucky. I would guess the furthest casino from Cincinnati (I believe the Belterra in Florence) would be the first to go, but it will be interesting to see how the casino in downtown Cincinnati fares. So far, the 4 big city casinos have seen a rapid drop off in revenues as the racinos open up and suburban folks flock to the slots there. Cincinnati may be able to maintain the casino based just on urban population and tourists/sports fans visiting, but I don't anticipate any pushes to expand casino gaming in Ohio beyond the 11 license holders we now have. The only true benefit to having casinos in Ohio is that we don't have people travelling to Indiana to save Hoosiers tax money. They aren't a net benefit to the state economy, but the are a huge benefit to Dan Gilbert, the Ohio horse racing industry and out-of-state casino owners.
The Atlantic Club shut down in January, taken down by two rivals, stripped for parts and closed in the name of reducing competition, eliminating 1,600 jobs.
In recent weeks, the owners of the Showboat and Trump Plaza announced plans to close, and Revel, which opened two years ago, said it, too, will close if a buyer can't be found in a bankruptcy court auction next month. That would put nearly 8,000 workers — about a quarter of the city's casino workforce — on the street.
"Most of us had expected one or two places to close this year and that would be it for a while, and it would give us a chance to catch our breath," said state Sen. James Whelan, a former Atlantic City mayor. "This is happening very quickly, and it is absolutely devastating to our region."
David Schwartz, director of the Center for Gaming Research at the University of Nevada Las Vegas, said casino markets around the country could find themselves in a similar situation — and soon.
Connecticut's tribal casinos have been affected by New York casinos and face an even greater challenge from new casinos going online soon in New York and Massachusetts. Mississippi, where Caesars Entertainment recently shuttered a casino in Tunica, has struggled with competition from expanded gambling in the Midwest and Florida.
Even Pennsylvania, which overtook Atlantic City as the nation's No. 2 casino market, is seeing its own casino revenue stagnate as competition grows.
Friday, July 25, 2014
We might not be there quite yet, nationally, but we are pretty close: