Barrow: Twin River big winner in casino race – for now

LINCOLN – Twin River Casino has emerged as the big winner in the casino race – for the time being, according to casino expert Clyde W. Barrow.
Barrow, formerly the director of the University of Massachusetts Dartmouth Center for Policy Analysis and now chairman of the Political Science Department at University of Texas, released his 11th annual “Northeastern Casino Gaming Update,” saying that the casino race is taking its toll on Foxwoods Resort Casino and Mohegan Sun Casino in Connecticut.
Barrow, in his report, wrote that the two Connecticut casinos have “experienced a fiscal and economic erosion over the last eight years that is surpassed only by Atlantic City casinos.” He said their revenues have decreased by 39 percent since their peak year in 2006, while they have shed nearly 37 percent of their employees during that time.
The reason?
Increasing competition. Barrow said their combined revenues slid from an estimated $3.2 billion in 2006 to $1.9 billion last year.
He noted that two “massive” slot parlors opened in metro New York City – Empire City Casino at Yonkers Raceway and Resorts World Casino New York on Long Island.
And, he noted that Rhode Island has grown Twin River into the third largest slot parlor in the country, and also added table games. Twin River’s management group also just announced that it is buying Newport Grand Casino, pending regulatory approval.
Maine opened small casinos in Bangor and Oxford, recapturing casino spending by their own residents who previously visited Connecticut casinos. Massachusetts and New Hampshire casino customers also shifted their habits, visiting casinos in Rhode Island and Maine, Barrow said.
Barrow wrote that he expects the revenue and employment decline to be magnified at Foxwoods and Mohegan once MGM Springfield opens in Massachusetts in two years. That casino will be less than 30 minutes from Connecticut’s capital city, Hartford.
“Additional casinos near New York City and Albany, as well as a proposed hotel at Twin River, make it inevitable that the competitive pressure on Connecticut’s casinos will intensify over the next two to three years,” Barrow wrote.
Barrow said that Massachusetts residents spent $878 million, New Yorkers spent over $365 million and Rhode Islanders spent $292 million at Foxwoods and Mohegan Sun in 2006, for a total of $1.5 billion.
In 2014, spending by Massachusetts, New York and Rhode Island residents dropped to $476 million, $214 million and $193 million, respectively, for a total of $883 million – a 42 percent spending decline. Residents from the three states comprise the largest revenue generators for the casinos, behind Connecticut’s own residents.
Individually, Barrow said, Massachusetts spending at Connecticut’s casinos has declined by 46 percent; New York, by 41 percent, and Rhode Island, by 54 percent, from 2006 to 2014.
“At the same time, Rhode Island’s Twin River has experienced explosive growth, intercepting hundreds of millions of Bay State dollars once spent at the Connecticut casinos, and finally growing spending by its own states’ residents who, for years, spent more money at the Connecticut casinos than at their own state’s largest slot parlor,” Barrow said.
Barrow pointed to Twin River’s expansion in 2007, as well as its addition of table games, as reasons for its success.
He said that in 2006, Twin River had $359 million in revenue, including $145.4 million from Massachusetts residents and $207.5 million from Rhode Islanders. That compares with $603 million in revenue last year, a 68 percent increase. Of that amount, Massachusetts residents accounted for $312.8 million in growth, a 115 percent increase, and Rhode Islanders, $271.8 million, a 31 percent increase, since 2006.
Revenues at Foxwoods Resort Casino declined by 43 percent, or by $685 million in the last eight years, to $892 million in 2014. Mohegan’s decline was similar, going to $1 billion last year from $1.6 billion in 2006, a 37 percent drop.
“The gambling arms race in the Northeast has essentially been a war waged against Connecticut and New Jersey – and, for Connecticut, that arms race will continue,” Barrow said.

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