News for the Hospitality Executive
Colorado Gaming Revenue Surge Among Top in Nation, Driven
Bet Limits from $5 to $100 and 24-hour Gaming
July 19th, 2010 - The Colorado gaming market has experienced tremendous growth in gaming revenue in 2010 while Las Vegas and other top gaming markets suffer through declines in 2010 due to the economic recession. Running counter to national trends, revenue growth has exceeded 8% for the May last 12 months (LTM) in Colorado, driven by increased bet limits from $5 to $100 and 24-hour gaming kicked off last summer.
As the table illustrates, Colorado has the second highest gaming revenue growth on year to year basis, while most other gaming markets in the United States have experienced flat revenue or significant declines in LTM 2010. Colorado’s growth is especially significant when considering that first place Pennsylvania’s growth has been driven by the recent introduction of gaming to the state and new casino additions.
A detailed look at the revenue sources (which do not include Indian Gaming) indicates that all of the growth in Colorado over the last year is due to the success of gaming in Black Hawk, which has grown over 12% for the year to date period through May. Ameristar Casino Black Hawk is leading that revenue growth following its recent $230 million expansion, which included the addition of a 536 room upscale hotel tower, spa and refreshed gaming area. The success of Ameristar illustrates the potential for a destination gaming resort in Colorado to tap into the affluent Denver population.
“Clearly, the change in Colorado gaming regulations has allowed Black Hawk to improve its market penetration and start the trend towards realizing its full potential as a leading gaming destination”, reported Mike Cahill, CEO& Founder of HREC.
Time to Develop a New Casino in Black Hawk?
Looking to build on the proven success of Ameristar, a local land owner, Frontier Companies, LLC has enlisted HREC Investment Advisors, to market for sale one of the last prime gaming development sites available in Black Hawk. Known as the ‘Dakota Site,’ it is located at the corner of Main and Richman Streets; the site offers a casino developer the potential to build a Las Vegas style destination casino resort in Black Hawk. The land owner envisions a building rising over 30 stories, encompassing over 800 hotel rooms, offering guests 1,500 or more gaming devices and a significant entertainment venue.
Larry Kaplan, Senior Vice President of HREC, explained “Developers and investors now have an opportunity to join in the success achieved by Ameristar and other local casinos through the purchase of this strategic 2.23 acre land site, proximate to Ameristar. We believe the timing is right for a developer to take advantage of historically low construction costs due to the economic recession. A project at the Dakota site will take several years to come to fruition, and investors will be eager to time the opening of this casino resort with a stronger national economy in 2012/13.”
About HREC: HREC is the nation’s leading lodging and gaming real
estate advisory firm specializing in property sales, mortgage brokerage,
equity/JV structuring, consulting (market studies and appraisals), asset
management and litigation support. With fourteen offices throughout North
America, HREC is distinguished by unwavering commitment to client service
through its team approach, intellectual capital and hotel/casino specialization.
6400 South Fiddler’s Green Circle, Suite 1730
|Also See:||Ameristar Casinos to Buy the Former Black Hawk Casino by Hyatt for $115 million; Will Invest $75 million for 300 room Hotel / June 2004|