Friday, October 05, 2007

Casino Blues: Know When To Hold 'Em - Fold 'Em

With Kansas casinos looming closer to reality if not actual construction- one has to wonder how many more gaming dollars this MetroRegion can sustain.

Unlike Nevada towns like Vegas and Reno where different establishments line up in the same block for casual pedestrian business- Missouri laws require the casinos be near the Missouri River. Locally- four houses exist- Argosy in Riverside- Harrah's in North Kansas City and the Ameristar and Isle of Capri in Kansas City itself.

The closest casinos are Harrah's and Isle of Capri at about 2 miles- but are separated by the Muddy and railroad yards- in other words- you need to have or secure ground transportation to get to any of the KC area joints.

With a state-mandated loss limit of $500 per 2-hour "session"- the Ameristar has led the market in revenue for at least 3 years. Each local casino also covers the state-mandated $2 admission fee per player.

Three of the 4 casinos now have on-site upper-class hotels. The Ameristar is the most lavish of K.C.'s casinos- built as the Kansas City Station Casino in the late 1990's- it has an enclosed streetscape mall area with restaurants for all tastes and price ranges as well as a multi-screen cinema- concert venue and child care services.

Now comes the competition. Bids for a "destination" casino have been taken in Kansas City- KS.. Minimum was $250-million- or just below the cost of building Missouri's Ameristar complex. The bids received were of lavish resort-like casinos costing upwards of three-quarters of a billion dollars.

This is going to draw away many Kansas and Missouri gamblers- at least temporarily- out of curiosity if noting else. More importantly- it's going to draw the "high rollers" since Kansas casinos will have no loss limits. This of course is not counting slot machines allowed at the Woodlands dog and pony track- nor any other casinos planned such as the Wyandott People.

The Missouri side casinos are going to suffer short-term at the least. I believe at least one will wash out- and the one I think that will go would not be good for KC-MO revenues: the Isle of Capri.

The Isle has no hotel- although plans for one have been on the table for at least 2 years now. The Isle also has the lowest attendance and revenue in the market. The owners are not large corporations like those who own the Ameristar and Harrah's- better able to sustain during a drop in players for any extended length of time.

Kansas City once had 3 casinos- Sam's Town closed not long after the massive StationAmeristar opened. The Metro King of TIF could suffer a sizable chunk of revenue loss if it were to lose one of it's 2 remaining casinos.

On the bright side- maybe an empty Isle of Casino property could be developed into something useful/interesting in conjunction with Riverfront Park. A new home for the steamboat Arabia?
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