If there were any lingering doubts that Pennsylvania’s gambling industry was in the initial stages of an Atlantic City like slump, October’s revenue tallies put them to rest.
Both the market’s table games and slot terminals exhibited healthy year-over-year gains, in total generating $252.2 mm in gross revenue.
As expected, slot machine revenues constituted the lion’s share of the winnings ($191.1 mm), while the industry’s table games sector experienced larger year-over-year gains (4.1%)
That being said, table game revenues were never the issue. Slots on the other hands, were mired in an elongated slump that saw year-over-year revenue drop in 11 of the past 12 months. Suffice it to say, the industry was desperately in need of more button pushers.
And that’s exactly what it got in October, as the sector grew 1.14% over last year. The state’s two smallest casinos, Lady Luck Nemacolin and Valley Forge were by far the biggest percentage winners, but it was northern Philadelphia’s own Parx Casino that boasted the biggest monetary gains, up 4.84% to a industry best $30.24 mm.
Parx’s table game offerings didn’t fare too shabbily either, producing gains of 21.2% and $1.96 mm en route to a $11.91 mm win. But the casino still has a ways to go if it hopes to usurp the Sheldon Adelson owned Sands Bethlehem, which reaped $16.95 mm (+2.9%) from its table game patrons.
There was a slight shift in the Pennsylvania casino hierarchy, as Harrah’s Philadelphia slipped to fourth place behind Pittsburgh’s Rivers Casino in table game revenue. Harrah’s has struggled mightily in 2014, presumably due to its misleading location (it’s actually in Chester), and mixed sentiments among locals, many of whom believe the casino is inviting increased crime and poverty.
Pennsylvania’s casino market may have benefited from September’s mass exodus of Atlantic City casinos. Expect December to be an even better month for Pennsylvania, and in particular Philadelphia, casinos, as a fifth AC casino (Trump Taj Mahal) prepares to shutter its doors.
- Lady Luck Nemacolin: Slot machines revenues were up an industry high 56.83%, despite the introduction of only a dozen new terminals. Table game revenues were also markedly up, 13% to $516.6 k. That being said, if the niche casino ever hopes to drag itself out of the industry cellar, it best expand.
- Valley Forge: Won 15.1% more from slot machines in Oct. 2014 than the year prior, but that pales in comparison to the growth of its table games sector, which ballooned an industry best 34.5% to $1.25 mm.
- Parx Casino: Since its inception, Parx has proved a model of consistency, exhibiting more year-over-year gains than any other Pennsylvania-based casino. Extra credit for thriving in Philadelphia’s highly competitive casino market.
- Harrah’s Philadelphia: Caesars lone Pennsylvania property is hemorrhaging revenue. It’s bad enough that its slot terminals bled 1.73%, but its table game revenue shrunk 18.9%, underperforming the industry by an alarming 23%.
- Mount Airy Casino Resort: It’s hard to say anything good about Mount Airy. The hotel rooms are overpriced, the dealers can be slow and obnoxious, and the air filtration system is under-powered. That, and its slot machine sector shrank an industry worst 4.1% since last year.
- SugarHouse: In terms of year-over-year revenue performance, SugarHouse resides in the middle of the pack. But it’s the casino most likely to be impacted by the construction of another Philadelphia-based casino, which by the way, is going to happen.
Philly gambling market about to become more saturated
Apparently, Pennsylvania adheres to the adage “You can never have too much of a good thing.”
On Tuesday, the PA Gaming Control Board awarded its 13th casino license to the partnership of Cordish Companies and Greenwood Gaming and Entertainment. The duo will break ground on the greater Philadelphia area’s fifth casino property.
The Board’s decision to approval the application was likely influenced by both the movement in New York to erect four Las Vegas style casinos and the results of a voters referendum in Massachusetts to uphold the state’s Expanded Gaming Act.
And thus begins the latest in a seemingly endless frenzy of casino building waves, solidifying the Northeast’s position as the most competitive casino market.
But saturation and relatively flat market performance hasn’t deterred the newest Philadelphia casino developers, and for good reason.
The $425 million Live! Hotel & Casino Philadelphia will be located in close proximity to two major highways (I-95 and I-76), placing it in a good position to attract patrons from both sides of the Delaware River. And if the name sounds familiar, that’s because the CEO of Cordish Companies, David Cordish, is the owner of the widely profitable and well-received Maryland Live! outside of Baltimore. Maryland Live! generates more revenue, on average, than any Pennsylvania casino.
Maybe there is room for one more casino in the Philadelphia area after all. Now, if you’ll excuse me, I just received a letter from the Board, stating that my application to build a casino in my backyard has been approved.
Photo Credit : NYTimes.com