The notion of New York City, home to more than 8 million people and travel destination for tens of millions of visitors, as the setting for a casino evokes mind-boggling images of money furiously changing hands, of fortunes being won and lost by the minute.
Such a speculative reverie is on the cusp of becoming reality as the New York State legislature, with the urging of Gov. Kathy Hochul, is on an intriguing path to authorizing licenses for three brick-and-mortar casinos in the Greater New York City area.
To be sure, the idea of legalized gambling isn’t novel in New York. There are a handful of cozy, well-appointed casino properties upstate, and earlier this year, statewide mobile New York sports betting launched with much fanfare, followed by impressive weekly reports of hundreds of millions of dollars being wagered.
But there’s something pretty darn dramatic about the potential for slot machines, blackjack tables and roulette wheels ensconced in some skyscraper within a dice throw of Times Square. (And so much for the quaint notion of Nathan Detroit’s oldest established permanent floating craps game.)
Much is still to be decided about those three casinos, not the least is which boroughs will get one.
How Political Figures View Manhattan as Site
New York City Mayor Eric Adams apparently thinks Manhattan should get two. But if that crowded sliver of real estate does land one of the casinos – and it’s hard to imagine that it won’t – there are some who insist that it should be of the upscale variety. More of a gambling parlor than a gambling hall. And perhaps, some have offered, it should be perched high above the city’s lights. In fact, one Upper East Side state senator mentioned the top floor of Saks.
Well, sorry to burst the balloon of folks who apparently have seen too many James Bond movies, but even the highest-rolling table games in Las Vegas are frequented these days by gamblers with towers of chips wearing shorts and T-shirts.
The early handicapping on who winds up with the NYC-area casino licenses has Resorts World/Genting and MGM as front-runners, mainly because both already have a casino presence in the greater New York area.
Genting Group, the Malaysian company that opened the glittering upscale Resorts World Las Vegas last June, operates a huge electronic games-only casino (6,000-plus games) in Queens. MGM has the Empire City Casino (5,000-plus electronic games) in Yonkers. Both also have race tracks. Resorts World is with Aqueduct Racetrack and Empire City is with Yonkers Raceway.
But despite all those slots, the two racinos lack the table games that make a casino a real casino. While it’s not guaranteed Genting and MGM are certain to get two of the three brick-and-mortar NYC-area licenses, at the moment, most of the speculative interest is centering on who gets the third license as well as exactly where that casino will be located.
NY Casinos Not Necessarily a Money Machine for Operators
Getting a casino license for Manhattan can be a double-edged sword for an operator. On the surface, it might seem like it’s a license to print money — just the math on the market, residential and tourism, along with the potential for a monopoly in Manhattan — makes the revenue potential clear. However, the upfront costs and even the ongoing expenses will be daunting. There’s talk about a licensing fee of $1 billion for the three operators, whoever they are. And then there are the issues of a tax rate and the regulatory climate a jurisdiction like New York can impose on a business that’s perceived as a municipal ATM.
Las Vegas Sands — which has ironically given up on its namesake city, selling off its Vegas properties to focus on Asia — has expressed keen interest in New York as well as in Texas and Florida. Of those three places, New York is the more immediate opportunity. And one would think LVS is happy with its balance sheet.
“By any metric, that should be a massive market for us, so we’re deep into it,” Las Vegas Sands CEO Rob Goldstein said of the New York metropolitan area on the company’s most recent earning call in January. “We were there last week (back in January), we have a team on the ground working through it, and we’re hoping to get a license. That’s all I’ll say about that.”
However, Soo Kim, chairman of the Bally’s board of directors, wasn’t quite as gushy, observing Manhattan isn’t the easiest locale to get to and navigate.
Urban casinos can have their challenges. As an example, the Caesars Entertainment casino in Baltimore has a city location near the Baltimore Ravens football stadium but its revenues have been about a third of the Live! Casino & Hotel, just about 20 minutes south in suburban Hanover, Maryland. The lobbying efforts in New York already have racked up costs in the hundreds of millions of dollars and have created a multi-sided push-and-pull of political turf wars, the needs of the city treasury, community NIMBY-ism, and strong labor interests.
The New York City casino license battle is far, far from decided and it promises to be great spectator sport.