Gas or Gamble? Economy Forces Some to Choose

In March, Deutsche Bank, the senior lender to the partially built Cosmopolitan Resort & Casino, began foreclosure proceedings on a $760 million construction loan after developer 3700 Associates was unable to raise cash.

But plenty of construction projects are near completion or proceeding. Wynn expects to open its 2,034-suite Encore hotel, including 72,000 square feet of casino space, next year on 20 acres of the Las Vegas Strip. In Atlantic City, a new 782-room tower at the Trump Taj Mahal is scheduled to open in September.

Expanding operations

Historically, tough economic times have caused expansion in the gaming industry, LaFleur says.

"Budget-strapped states have looked to gambling for incremental revenue and an alternative to raising taxes," he says. If the economy remains weak, he says, there might be more pressure for states to establish or expand existing operations.

That's already happening in Rhode Island, where lawmakers are considering measures to reduce a $568 million budget deficit by increasing weekday hours at its two slot parlors and operating around the clock on weekends and holidays. Slot machines provide about 8% of the state's income.

The weak economy isn't deterring John and Debbie Sue Bremseth of Ivins, Utah, who drive about 40 miles weekly to the Oasis and Eureka casinos in Mesquite, Nev., to play video poker. The retired couple, who pay about $3.55 a gallon for gas, say they won't change their routine.

"We will still visit casinos an average of four times a month," says John, 67, who worked in various jobs for three airlines. "The great free lounge entertainment, plus the more reasonable food costs and gaming excitement, make it a real value for us."

To save money on casino trips, Al Katz sold his SUV last month and bought a more fuel-efficient Toyota Camry.

Katz, a 55-year-old comedian, drives with his wife, Colleen, about 70 miles every week or two from his home in Kissimmee, Fla., to the Hard Rock Casino in Tampa. They also drive more than nine hours a few times each year to gamble in Biloxi, Miss.

"We may have to eliminate a trip or two" if the economic downturn continues, says Katz, who entertains on cruise ships. "Every time I get off a cruise ship, gas is a quarter more expensive."

Marie Braun, 45, of Olathe, Kan., has already made the decision to cut back, from five casino visits a year to two or three visits. Gas is too expensive for a 60-mile round trip to Missouri, says Braun, who works for a telecommunications company.

"It's pretty tough to justify spending money on any kind of entertainment when it costs so much just to get to work each day," she says.

Says Stillwell of Boyd Gaming: "At the end of the day, people don't have as much money for entertainment. It doesn't get anymore black and white, and there's nothing you can do to change that."

-- This embed didnt make it to copy for story id = 4801536. -- This embed didnt make it to copy for story id = 4801536. -- This embed didnt make it to copy for story id = 4801536.
Page
  • 1
  • |
  • 2
  • |
  • 3
Join the Discussion
You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus
 
You Might Also Like...