Connecticut Casino Market Tumbles in October

MGM Springfield in Connecticut

Connecticut’s casino market tumbled last month. Not only did the state’s two tribal casinos suffer year-over-year declines in October, but its new commercial casino, MGM Springfield, has also now suffered a second straight month of declines since its grand opening on August 24, 2018.

Tribal Casinos Suffering

The Constitution State has two tribal casinos, namely the Mohegan Sun located in Uncasville, and the Foxwoods Resort in Mashantucket. After MGM Springfield opened for business this summer, the casinos were subsequently expecting their bottom lines to take a hit. They were not wrong.

In October, Mohegan Gaming & Entertainment saw slots revenue at its Mohegan Sun property slide by a whopping 10.5 percent to $42.5 million from the $47.6 million collected in the same month a year ago. The latest result follows a 1.3 percent decline in July, a roughly 1 percent fall in August, and an 8.8 percent drop in September.

Meanwhile, the Mashantucket Pequot tribe owned Foxwoods Resort Casino saw its slots revenue contract by 10 percent to $34.4 million compared to the $38.2 million posted in October 2017. The casino’s slot revenue has similarly declined over the past few months, including recording a 5 percent fall in July, a 1.6 percent drop in August, and a 5 percent contraction in September.

Competition From MGM Springfield

The tribal casinos’ four-months of declines comes as the $960 million MGM Springfield approaches its third full month of operation. Both venues had anticipated their revenue being negatively impacted by the commercial casino’s opening, but on the positive side, Foxwoods said that its overall business volume exceeded expectations in October. As Mashantucket Pequot Tribal Nation spokesman Adam Jalbert, explains:

“With MGM Springfield in its first few months of operation, not only did we expect to see an impact, we’ve also consistently and publicly communicated our expectations over the last three years while proactively working toward mitigating any potential loss in revenue. We are pleased to say that, despite the temporary decline in October, our business volume and gaming activity still continues to exceed our expectations.”

Foxwoods and Mohegan Sun have also proposed the building of a joint-owned $300 million casino resort in East Windsor in order to remain competitive in the New England market. The proposed site is located about 12 miles south of MGM Springfield. Nevertheless, the development has had to be put on hold as it requires a revision of the state’s existing tribal gambling agreement before being built.

In a recent decision by Judge Rudolph Contreras from the U.S. District Court of the District of Columbia, however, the Mashantucket Pequots have no legal standing to compel Connecticut’s Department of the Interior to accept revisions to the state’s existing gambling compact.

Connecticut’s Contracting Casino Market

Connecticut’s land-based casino industry reached a peak in 2006 after Mohegan Sun and Foxwoods generated $229 million and $204 million in slots revenues, respectively. Business has declined dramatically since then and in 2017 Mohegan Sun saw its slots revenue drop to $152 million, and Foxwoods to just $117 million. This has led some lawmakers to propose the introduction of online gambling as a means of providing revenues with a much needed boost.

MGM Springfield

MGM Springfield opened to great fanfare in August, and during its first full month of operation in September generated nearly $26.95 million in gross gaming revenue. This included more than $18 million from slot machines, and $8.8 million from table games. The state then collected $6.7 million by way of gambling taxes, according to the Gaming Commission.

In October, however, MGM Springfield saw its month-over-month revenue plummet by 18.5 percent to just $22 million. Commenting upon the latest result, MGM casino spokesman Saverio Mancini said that the venue has been tweaking its gambling offerings in response to customer feedback. Adjustments made so far include extra slot machines being added to its “high limit” area, and the addition of more video poker machines at the casino, as well as the offering of lower stakes roulette and blackjack tables.

Connecticut’s other commercial gambling venture is Plainridge Park, a racino in Plainville. Following the trend of the state’s other gambling businesses, the venue saw its revenue drop to $13.5 million last month, down from September’s tally of roughly $14 million.