NORTH RANDALL, Ohio - From the Boardwalk of Atlantic City to the Pocono Mountains of Pennsylvania, from Philadelphia to Cleveland to Cincinnati there are no fewer than 30 casinos or racinos where people can gamble.
Most of them cost hundreds of millions of dollars to build -- one, the Revel in Atlantic City cost $2 billion but the spot that brings in more money per slot machine per day is the one squeezed into second floor of a 1950s horse race track grandstand, an $88 million retrofit, ThistleDown Racino in North Randall, Ohio.
November revenue figures released by the three states this week show ThistleDown’s 1,152 slots or VLTs took in $13.3 million after all bets were paid in November for a daily take per machine of $385.
Of the remaining 29 casinos only the Borgota in Atlantic City, which cost $1.1 billion to build and Harrah’s Atlantic City came in with daily take per machine figures above $300.
“I’m shocked and I’m sure all the casino executives are shocked too,” said Casino Industry Analyst Roger Gros. “I think they’re very surprised at the numbers these racinos are putting up and again racinos that have nothing special.”
Gros, who is publisher of the industry-leading magazine Global Gaming Business, said when the state brokered the deal with the Rock Ohio Caesars and Penn National that cleared the way for video lottery terminals at Ohio’s seven horse racing tracks it was almost an afterthought.
“They didn’t have second thoughts when this got approved except they knew they wanted to be a part of this so it didn’t really hit them that badly,” he said of the potential loss of customers.
While ThistleDown has impacted Horseshoe Cleveland’s slots revenue, they are both owned by Rock Ohio and combined the two continue to generate more and more money each month.
The test Gros said will come with the Dec. 18 opening of the Hard Rock Rocksino at Northfield Park, a racino that is everything ThistleDown isn’t. A $268 million, built from the ground up, Las Vegas-style slots-only casino offering its customers everything from gaming to entertainment to dining under one roof.
“I think this Rocksino thing is going to be very big,” said Gros. “You’re seeing what ThistleDown is doing with virtually no branding.”
“The Hard Rock is an iconic brand. They attract people from all walks of life, all spectrums,” he said.
That’s exactly what Hard Rock Rocksino President Jon Lucas is banking on.
"With the entertainment aspect and the food and beverage aspect and making it a true entertainment destination, we really think we can grow the market and expand our reach a little further than what's being done now," said Hard Rock Rocksino President Jon Lucas.
Growing the market will be key -- northeast Ohio will have three gambling options within a 20-mile radius.
“In some of the studies that we’ve done and the research that we looked at in like cities such as Pittsburgh and Kansas City, which have similar populations, and looking at the gaming volume there, we think that there’s room for growth here.
“I think there’s still some Ohioans that are heading over to Pennsylvania and West Virginia. We hope we can bring them back,” said Lucas.
If they don’t and they only draw customers and dollars from Horseshoe and ThistleDown, it may push Rock Ohio Caesars in the direction of moving ThistleDown to the Akron-Canton area, which was allowed under the 2011 agreement that cleared the way for VLTs at horse tracks.
Rock Ohio Caesars though would have to pay the state $25 million for the right to move then spend $150 million to buy land and build a new racino when they already own the North Randall site and have invested close to $90 million in the property.
Rock Ohio has until June 2014 to decide whether to move or stay.
“I think when you see the Hard Rock open up, I think that’s going to impact (ThistleDown) more than it will impact the downtown (Horseshoe Cleveland) property,” said Gros who could see them decide to move the racino.
“Akron is an underserved market so that wouldn’t surprise me,” he said. “The fact that (ThistleDown) is performing so well I think is important, that they’ll expect that kind of performance and even more in Akron.”