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NORTON NOTES: Is There an Over Saturation of Casinos?
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By Steve Norton
CEO, Norton Management
How Many Casinos are too Many?
My comment:
Ken Adams wrote a very compelling article in the CDC Gaming Report. I also responded to Mr. Fertitta's article, on Atlantic City offering too much gaming. This is not a new discovery.
All major gaming destinations in Nevada have had numerous failures, or unfinished projects, like the LV Fontainebleau. Mississippi saw its first 7 casinos in Tunica close due to the number of casinos competing for the Memphis market. Atlantic City saw 5 casinos close after Pennsylvania, approved slot machines and New York added slots at Aqueduct and Yonkers racetracks; with AC casino win dropping from $5.2 billion annually to a number less than half the 2006 win.
NORTON NOTES: Kudos to Tillman Fertitta
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- Hits: 957
By Steve Norton
CEO, Norton Management
Atlantic City “Not a 9-Casino Market, Golden Nugget Owner Says
My comment:
It is great to hear someone else agree that Atlantic City has too many casinos for its existing market. I have been arguing for changing Atlantic City's market strategy within two years after we opened Resorts International in 1978. At first, it was line run buses that I started in November 1978, mid-week, days only, while we were still a monopoly. Even in the early years, our RICH occupancy was in the 60% range, during the winter season. As chairman of the AC Convention Bureau, I was arguing for major conventions and trade shows that didn't require air service. But few other operators agreed.
NORTON NOTES: VGT Tax Rate Hurting Illinois
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- Hits: 1031
By Steve Norton
CEO, Norton Management
Illinois Raked in More Gambling Tax Money Despite Casino Decrease
My comment:
Illinois not only cost itself substantial tax revenue from its riverboat casinos but then passes a new form of gaming with Video Gaming Terminals at a lower tax rate in spite of the enormous differential in development cost per gaming position.
In 2007 there were 9 riverboat casinos, that won $1.983 billion, paid taxes of $834 million (42% tax), enjoyed annual admissions of 16.5 million visitors, employing about 8,000 persons. Instead of growing during the next 10 years after the state introduced VGTs, those 9 riverboats saw their win decrease by $1.008 billion (down 51%), taxes declined by $525 million (-63%), and employment losses exceeded 3,000 persons (almost 40%).
NORTON NOTES: He Agrees with My Earlier Comments
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- Hits: 889
By Steve Norton
CEO, Norton Management
Column: A Consultant Disses Lightfoot’s Casino Sites. Now What?
My comment:
I felt the initial casino revenue potential would be closer to $1.5 billion and the potential of the other sites, overstated. Plus, they would be drawing the majority of their play from residents, harming existing casinos, and VGT operators. The majority of win from a downtown Chicago casino would be from visitors, convention attendees and business travelers.
Convention and tradeshow organizers should look at the Las Vegas Strip results, and recognize that even though a few attendees may miss a meeting because of the nearby gaming, the total attendance and number of exhibitors will expand substantially because of the nearby gaming and quality entertainment that accompanies a destination casino resort.