With table games proliferating, execs say East Coast casino market getting cutthroat

Execs: East Coast casino market getting crowded

ATLANTIC CITY, N.J. — As new casinos keep popping up, even with overall gambling revenue stagnating, casino companies are fighting harder for smaller shares of their market.

Executives at the East Coast Gaming Congress, a national casino conference, said Tuesday that with many states now adding table games to the mix, it’s going to be even tougher to succeed in the cutthroat East Coast market.

“We have to fight this explosion of gambling all around us,” said Don Marrandino, eastern regional president of Harrah’s Entertainment Inc., which has four casinos in Atlantic City. “We have to continually reinvent ourselves as a destination.”

Operators of commercial casinos in New Jersey, New York, Pennsylvania, Delaware, Maryland, Ohio and West Virginia told the gathering in Atlantic City they are being forced to fight for one another’s customers.

“I don’t think it’s saturated yet, but it’s clearly crowded, clearly more challenging,” John Finamore, senior vice president of regional operations for Penn National Gaming, said of the East Coast market.

Frank Fahrenkopf Jr., president of the American Gaming Association, said 12 existing slots-only casinos on the East Coast will add table games within six months. The group doesn’t include Indian casinos.

“We think the impact is going to be significant,” he said.

Nowhere is the situation more dire than in Atlantic City, where as many as three of the 11 casinos could close if things don’t improve soon.

Once the only place in the nation outside Nevada with legalized gambling, Atlantic City is now beset by competition on all sides.

Pennsylvania, which legalized slots parlors in 2006, now has nine, with table games coming soon. Delaware started testing table games Monday at its racetrack casinos. A new slots parlor is planned in New York City at Aqueduct Racetrack, and there has been talk of expanding slots to Belmont Racetrack as well. Maryland will open its first casino this fall in Cecil County, and a fourth West Virginia slots parlor will add table games soon.

All of this pits one casino company against another in the nation’s $60 billion gambling industry, which is roughly half commercial and half Indian casinos.

Each company hopes its new gambling halls will create new customers who previously haven’t gambled. But executives acknowledge the reality is many are trying to grab customers away from other casinos.

Penn National will open its Hollywood Casino Perryville in October with 1,500 slot machines, just off Interstate 95 in Maryland.

“We hope most of the business will come from Delaware,” Finamore said. “About 31 million cars a year go right by that spot from the Baltimore suburbs up into Delaware. We hope to cut them off.”

Bob DeSalvio, president of Sands Casino Resort in Bethlehem, Pa., said his facility is seeing new customers who hadn’t patronized any casino before coming there.

“I do think there is new penetration in our area and our region,” he said.

But, he added, if New Jersey approves a hotly debated proposal to expand slot machines to the Meadowlands Racetrack, that would hurt Sands.

“We get a significant number of our customers from northern New Jersey,” DeSalvio said. “It is not a prospect we would enjoy.”

Penn National will add table games to its Charles Town casino in West Virginia within 60 days — and expects to draw high-rolling Asian gamblers who now go to Atlantic City.

“There are about 400,000 to 500,000 Asian people in that market,” Finamore said. “These are customers we don’t see at Charles Town. They don’t like to play slots, and that’s all we offer. They want to play table games. They go currently to Atlantic City, and we’re looking to maximize (that market).”