The odds of Las Vegas-style casinos in Mexico are improving by the day. A
new federal gaming law is expected to win approval at the national legislature
“I am now predicting it will pass,” says Donald Brennan,
vice president of development for Nevada Gold & Casinos Inc.
Brennan, who lived in Mexico for four
years in the early ’90s, envisions the casino legislation allowing about 65
percent foreign ownership in casinos, with 35 percent held by a Mexican partner.
Conservatively estimated to be a $3
billion-a-year market, Mexican casinos have drawn interest from north of the
Susan Bala, president and chief
executive officer of Racing Services Inc., says the $3 billion figure is a
“I think it’s an exponentially much larger number,” Bala
said. Some say the market across from the Laredo-Brownsville region alone could
at least generate $600 million yearly.
Racing Services Inc., which operates
eight books in Mexico, is preparing to open a horse and dog track across the
border from Laredo. Mexico has had legal racetracks since the 1930s and race and
sports books since the 1970s.
On the casino front, several Las Vegas
operators have been quietly eyeing the Mexican market.
Harrah’s, which recently established
its presence in San Diego County, has publicly stated that it would consider
forming partnerships with Mexican investors
Bill Wortman, a partner in the new
Cannery Casino in North Las Vegas, has expressed interest in building a gaming
complex in Reynosa, Mexico, across the border from McAllen, Texas.
The former Caesars exec said he and
unidentified Mexican partners would spend $100 million to build a casino and
18-hole golf course in the community of nearly 1 million people. He has provided
no further details.
Now, with Mexican President Vicente
Fox poised to sign legislation establishing a National Gaming Commission, casino
action is sure to heat up.
A draft of the bill calls for casino
applicants to explain the origins of their investments. They will not be
permitted to build within 200 meters of schools, hospitals or churches. No
casinos on cruise ships will be allowed to operate while docked in Mexican
Mexico’s about-face on gaming was
triggered by the country’s economic downtown and a desire to attract more
tourist dollars. There also was a recognition that some 1,000 casinos are
already operating illegally — and making a bundle tax-free.
“We can’t continue to believe that
by ignoring the problem it will cease to exist,’’ said Luz del Carmen Lopez
Rivera, a congresswoman who supports legalizing gambling. “Lack of rules
propagates clandestine arrangements, bribes and all the vices that result from
an activity without any control.’’
Gaming consultant Steven Gallaway of
the Innovation Group advises prospective gamers to select a substantial, wealthy
and well-respected Mexican partner to have any chance at licensure. “If you
don’t, don’t get in there,’’ he warns.