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Dynamics Help Locals Market Flourish

One of the reasons competition for the locals gambling customer is so strong is that Las Vegas locals love to gamble.

To meet that demand, locals casino operators have created the gaming industry's most efficient mechanism for separating patrons from their gambling dollars.

Station Casinos and Coast Casinos executives won't say how many Las Vegans are in their customer databases, but the numbers that are available don't lie.

Las Vegans gamble a lot, with 69 percent of county residents admitting it in a 2001-02 Las Vegas Convention and Visitors Authority survey,

And 43 percent of those gamble at least once per week, with 39 percent budgeting $50 or more per visit.

Most of that gambling budget ends up in the coffers of locals casino operators, as the survey reported that 84 percent of resident gamblers prefer off-Strip locations.

In the 12-month period ended May 31, gamblers lost $667.4 million to Boulder Strip casinos, $211.9 million to North Las Vegas casinos and $777.1 million to the nebulous state "balance of Clark County" market that includes locals dynamo Suncoast but also includes far-flung properties in Primm and Jean.

Since January 2000, there have been a number of significant developments in the locals casino industry, most of which presumably added to the total locals lost at the slots, tables or sports book.

Among the most significant were:

. 1. Enforcement of Senate Bill 208 to scotch casino projects in Spring Valley and North Las Vegas.

Boyd Gaming Corp.'s hopes of operating a Spring Valley casino were dashed in 2000 and Station Casinos plans to build a casino at Craig Ranch Golf Course in North Las Vegas were quashed when the review panel of the State Gaming Policy Committee voted to kill the proposed casinos, saying they'd harm the quality of life of nearby residents.

The 6-year-old law puts the burden on developers to prove that a neighborhood casino won't adversely affect the quality of life of nearby neighbors, and, in effect, limits the number of sites available for local casino development.

. 2. Ticket-in, ticket-out coinless slots.

The devices cost hundreds of coin handlers their jobs, but saves millions in labor costs. Casinos initially feared customers would reject the ticket-dispensing and accepting machines, preferring the sound and feel of real coins. But customers overwhelmingly prefer the ease, cleanliness and time-savings of ticket payouts, operators agree.

. 3. Station's Boarding Pass slot card dominates the market.

Competitors Coast and Boyd Gaming have yet to break out systemwide slot clubs, giving Station a major advantage. The cards let players earn and spend comps at any of the company's properties, and also serve as a vehicle for Station's best-in-market Acres bonusing systems, allowing free play and Jumbo Jackpot promotions.

. 4. Michael Gaughan opens the $200 million Suncoast in 2000.

The next-to-Summerlin property proves the power of placing a megalocals casino smack-dab in the middle of the suburbs.

. 5. Station and the Greenspun family open Green Valley Ranch in 2001.

The Greenspun's master-planned Green Valley Ranch development may provide the blueprint for some of the valley's next generation of locals casinos, as SB 208 limits most other choice sites. Station gives up 50 percent of profits to its partner in exchange for the opportunity to place a casino in a demographic sweet spot, a deal framework that casino operators agree will be one model for future local casino development.

. 6. Station's Thunder Valley Casino, operated for the United Auburn Indian Community near Sacramento, Calif.

Station Casinos bosses say the $65 million to $75 million they expect to collect annually from Thunder Valley, outside Las Vegas, will enable the company to build new properties bigger and faster in Las Vegas.

. 7. The Orleans and Gold Coast expansions in 2002 and 2003.

. 8. The Maloof family opened the Palms in 2001.

. 9. Station Casinos' 2000 and 2001 deals to buy the Santa Fe, Reserve and Fiesta hotel-casinos.

. 10. Owners Bill Paulos, Bill Wortman and Bob Mendenhall open the $105 million Cannery this past January.

. 11. Sam's Town expansion in 2000-01.

. 12. Regent Las Vegas, Vacation Village and Castaways file for bankruptcy protection.

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