We have some comparisons for Florida’s first quarter of slot operations. One thing is for sure: the overall business is successful, and bodes well for future growth.
The numbers appear to coincide with the strong winter tourist numbers being reported by the State for the South Florida area. The opening of Casino Miami Jai Alai has, as expected, added to the overall business and, contrary to some expectations, it has had virtually no negative effect on Magic City’s (Flagler) NSR.
The overall increase in tourism numbers for the State was up 17.3%. In real dollars that equates to $18,135,000. For the first three months of 2012 that’s considerably better than most regions of the country.
As has been the case since the outset, Isle Casino Racing (Pompano Park) leads the way in total NSR and also in monthly and total increases. For the first quarter Isle is up a generous 12.61% or a little more than $4 million in Net Slot Revenue.
Those numbers are especially impressive considering the Seminoles enlarged and upgraded their Coconut Creek facility, which was specifically marketed as a new property to compete with Isle. Noteworthy: even without blackjack, Isle’s slot and poker business is the State’s leader in all gaming.
Perhaps the most notable change on the gaming scene in South Florida was the January addition of Casino Miami Jai Alai. The 3.5 mile proximity to Magic City was expected to create one of two scenarios: either Magic City’s revenue would fall or Casino MJA would not be relevant.
As it turns out, both concerns were non-issues. Magic City continues to enjoy extremely good numbers. It had the second highest increase for the 1st Q being up 6.96%, more than 1.3 million dollars in NSR. In addition, Casino MJA added a generous $10.5 million to the NSR and indicated they will be a viable contender to Magic City for Miami’s top facility.
The fact that Casino MJA has 258 more devices than Magic City affords it the opportunity to grow more. Concerns that Casino MJA would be hard to access and consequently have problems attracting business were ill founded.
Calder Casino & Race Course continues to show a steady gain. Finishing third in the 1st Q, they were up 6.53%, equating to over $1.2 million in NSR. Considering the time of year when most attention to racing points to Gulfstream, Calder marketed itself very well and continued to find their demographic with good results. With their live racing season underway, and the added new benefit of live racing days in April, Calder should continue to show gains.
The two facilities in the closest proximity are Gulfstream Racing & Casino Park and Mardi Gras Casino. Each separately and together had a respectable first quarter. While Gulfstream was the first "kid on the block" back in November of 2006, within two months Mardi Gras was almost doubling the NSR.
Mardi Gras management is a seasoned racino operator with a terrific operation in West Virginia. Ownership simply took the template for WVa and moved into Florida with considerations for size and potential growth.
While Gulfstream muddled along tweaking and growing their entire concept, Mardi Gras cranked up great numbers. However, when Pompano/Isle opened and serious advertising and marketing competition came from the Seminoles, plus the other racinos, Mardi Gras found itself trailing the field.
Today, with the exception of the brand new Casino Miami Jai Ali, Mardi Gras continues to do the least amount of business. Their increase was a modest 2.66%, close to $450,000. Gulfstream did a bit better with a 3.04% increase (about $520,000) ahead of last year.
However, the layout severely limits their gaming space. Additionally, Gulfstream still concentrates its marketing and promotion priorities on racing during the prime winter months.
Here are our considered observations based upon these reports: While many officials and gaming naysayers in South Florida are being heard, the numbers indicate there is room for expansion.
Genting, the giant international casino operator, Steve Wynn and Sheldon Adelson are all sniffing around as is Donald Trump. Genting’s recent bayside purchase indicates they have operatives on the ground both in Miami and Tallahassee studying the numbers.
Miami’s Magic City Casino and the Casino Jai Alai are managed by former pari-mutuel executives, and they have little to no experience in the hard ball competition typical of gaming ventures.
Miami is primed for expansion and it should have it sooner rather than later. As we all are aware, there is a finite time to make big money returns on casino investments before saturation sets in. In Miami, now is that time.
The situation on Hialeah Park getting slots remains unclear. The legislature did not approve it. If Hialeah should come on board it will have a definite impact on the profitability at both Magic City and Jai Alai.
In Broward the situation is far different mainly because of the Seminole Hard Rock Casino. Thus far Boyd Gaming, which owns Dania Jai Alai, has chosen to not introduce the slots. This, we surmise, is largely due to the hefty competition primarily with the Hard Rock and nearby Mardi Gras and Gulfstream (all within 12 miles of each other).
Additionally, the "new" Seminole Coconut Creek casino is located closest to Palm Beach County where racinos are NOT permitted yet – a potential windfall for any operator who could successfully become a gaming operator there. The Rooney family, which owns Palm Beach Kennel Club in the heart of West Palm Beach, would be a strong candidate for the territory.
The table was set in the 2012 legislative session, the big players will return with more modest visions to present. They will be successful; the numbers tell the story.