New casinos in Northeast US could affect Atlantic City

The eight casinos that survived the cull in Atlantic City last year will face further strain, as new out-of-state competition will look to siphon regional players.

Atlantic City was built on domestic gamblers visiting its hotels and casinos. The resort city lost its monopoly when neighbouring states started to legalize casino gaming a decade ago and revenues have been progressively falling ever since. Pennsylvania, which opened its first casino in 2006, overtook Atlantic City to become the nation’s second largest gaming market.

“We expect increased competition will keep the heat on incumbents, and that number of casinos in Atlantic City will likely continue to shrink. We expect more casino closures to occur in Atlantic City as some struggle to grow their businesses and face additional competition,” wrote Moody’s in its report.

At least eight new casinos are expected to open by the end of 2018 in Maryland, Massachusetts, New York and Pennsylvania. MGM National Harbour, is the first of the eight projects scheduled to be up and running in the second half of 2016. The $1.3bn casino complex will feature 125,000 sqft. of gaming space with slots, tables and poker room.

The Moody’s report also noted the new businesses will additional hurt existing gambling venues in Maryland, New York, Pennsylvania and Rhode Island. MGM National Habor is situated just 10 miles south of Washington, where it stands to hurt Maryland Live! In Pennsylvania, a second Philadelphia casino will affect Sugarhouse and Harrah’s properties.

Four new casinos could also be open in Upstate New York by the end of 2018, which could hurt seven of the nine racinos in New York state, as well as increase competition in the Northeast region. While Atlantic City casinos compete between themselves, they will have to create new attractions and facilities that ensure visitors keep coming to the city.