New York State Casino Plan Moves Forward with Voter Approval
A plan in New York state to add seven land-based casinos won the approval of voters there this past Tuesday, and the construction of those properties could be yet another thorn in the side of Atlantic City, according to the South Jersey Times’ nj.com.
Constitutional amendment clears the way for upstate development
Tuesday’s election saw the easy passage of a constitutional amendment that clears the way for four new commercially-operated casinos to be built in upstate New York, with three for the New York City metropolitan area to follow within seven years.
The upstate casinos will likely be able to successfully lure New York-based gamblers away from popular casinos in neighboring Pennsylvania, which, thanks to the success of its own land-based casino expansion in recent years, moved to capture the title of second-biggest gambling market in the U.S. in 2012.
“New Jersey has casinos. Connecticut has casinos. Pennsylvania has casinos. We literally hemorrhage people from the borders who go to casinos. I think it will keep the money in this state and I think it is a major economic development vehicle for the Hudson Valley especially and for upstate New York,” Governor Andrew Cuomo, a major proponent of expanding land-based casino gambling in the Empire State, told the New York Daily News.
“We want the New York City market coming north,” Cuomo said this week.
Loss of New York gamblers will be blow to Atlantic City
The defection of New York City-area gamblers to the new upstate casinos is exactly what Atlantic City ought to be worried about. Atlantic City has seen a decline in revenue – and casino property values – as a handful of states along the Eastern seaboard have moved to increase the availability of gambling in order to secure additional revenue.
Atlantic City has seen annual gambling revenue depreciate every year for six straight years since reaching a peak in 2006.
Morningstar casino analyst Chad Mollman told reporters that officials and regulators in Atlantic City should be “very worried” at the passage of the constitutional amendment in New York.
“New York City is the biggest feeder market in Atlantic City. There is a question in terms of the viability of Atlantic City in the long term,” Mollman said.
Internet gambling seen as potential savior for struggling city
When real money online gambling in New Jersey goes live on November 26, it may mark the beginning of a new era for the downtrodden gambling mecca. Early predictions are putting the potential of that state’s online betting revenue at $1 billion per year on the high side.
Real money online wagering web sites will launch in New Jersey on November 26 after a 5-day soft launch period beginning on November 21, during which only invited players will be allowed to try out the sites. It is unknown whether the sites will be accepting real money wagers during the soft launch period, or whether the games will be play money only during that timeframe.
Players will need to be over 21 years of age when accessing the sites and also must be physically located in New Jersey when logging on. New Jersey became the third state in the nation to regulate some form of online betting when its governor, newly re-elected Republican Chris Christie, signed the state’s iGaming legislation into law last February. New Jersey will offer a comprehensive array of games in addition to online poker.
Still, there are some who don’t see iGaming in New Jersey as having as much power to right the ship as is being forecast.
“Atlantic City’s time has come and gone. It was second after Nevada, and it was a special place in a small location. It had 10 good years when it was pretty unique, but then we got Indian casinos, and then gambling in Pennsylvania,” said Harold Vogel, who is the CEO of Vogel Capital Management and wrote the book Entertainment Industry Economics: A Guide for Financial Analysis.