The “single greatest mistake” that a government or jurisdiction can make is to allocate land for a gaming project simply on the basis that it wants urban redevelopment in that spot, says a new report from Global Market Advisors LLC.
“Simply because government has identified a site that needs to be redeveloped does not make it compatible for an integrated urban casino resort. The Ameristar Casino in East Chicago, Indiana is a perfect example of a casino resort that has no viable business reason for being situated in its current location – with the exception that at one time local government deemed it appropriate,” stated the report ‘Casinos and the City’ by Andrew Klebanow and Steve Gallaway.
Global Market Advisors – which has offices in the United States in Las Vegas and Denver, and in Asia in Taipei, Taiwan and Bangkok, Thailand – provides consulting services for the casino gaming, hospitality, aviation and tourism industries. It says it maintains active clients in United States, Europe and Asia. In Asia, it further states it has advised clients in South Korea, Singapore, Japan, Taiwan and eastern Russia.
The company’s 46-page report on urban casinos – which it describes as a “White Paper on the history of casino development in cities, past and current trends, and recommendations for future development” – accepts however that gaming licences, by their nature, are “privileged” permissions. As such, government is the “ultimate arbiter to decide who should be issued a licence and where the casino should be located,” said the authors.
But they added: “Working with the developer, government should identify a zone within the city that would be designated as an entertainment/commercial development zone. This zone would have within it certain qualities that assure compatibility with surrounding businesses such as restaurants, nightclubs, hotels and theatres. The zone would also be near both mass transit and the region’s highways and the site should be of sufficient size to support a gaming enterprise. An urban casino stands the greatest chance of success when it is located on a site that is mutually compatible with surrounding businesses.”
The report doesn’t cite any Asian casino zones as failing all of those tests. It does however single out Macau peninsula (pictured) for praise in terms of the success of its urban casinos.
“There is no better example of casinos working harmoniously with their surrounding neighbours than the casinos that comprise the central casino district on the Macau Peninsula,” the duo wrote.
“What makes the casino district on the Macau peninsula so unique was its organic development. As the first wave of casinos opened in and around the central business district before 2004, retail development grew to take advantage of the pedestrian flow generated by those casinos. With the development of the new generation of casino resorts, those new properties (Grand Lisboa, Wynn, MGM, L’Arc and StarWorld) built entrances that opened into the street grid. With limited amounts of available land, those casinos could not develop expansive buffer zones, which in turn allowed for the free flow of visitors into and out of their casinos,” said the authors.
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"If the [Macau casino] concessions are put up for bid, there will also be a lot of giant Chinese companies, some having nothing to do with gaming, which would like to take over these enormously successful casinos”
Professor emeritus at Whittier Law School in California, in the United States, and a visiting professor at University of Macau