Detroit Casino Revenue Increases for Fourth Straight Month in June

Detroit Casino Revenue Increases for Fourth Straight Month in June

Detroit may have languished in the doldrums for a number of years following the financial crisis in 2008, but all signs point towards a revival in the city’s economy, with the positive trend reflected in the growth of its casinos industry, which had its best spring since 2012. The summer season has started in the same vein, too, with June’s revenues rising by 5.3% to $119.1 million compared to the same month in 2017.

The three casinos subsequently paid a total of $9.6 million by way of gaming taxes to the state of Michigan, or 4.3% more than they did for the same month in 2017. An additional $14.2 million was also paid in wagering taxes and development agreement payments to the city of Detroit.

Detroit’s Three Casinos

All three of Detroit’s casinos reported year-on-year gains in June, led by MGM Grand Casino with $51.8 million in revenue, marking a 6.6% improvement compared to the same month last year. Meanwhile, MotorCity Casino Hotel and Greektown Casino-Hotel both posted 4.4% revenue gains for the month, with their winnings amounting to $39.6 million and $27.7 million, respectively. As a result, MGM Grand commanded a 44% share of casino revenues in June, followed by MotorCity (33%), and Greektown (23%).

Solid Year So Far

After a slow start to 2018 in which casino revenues fell by 4% in January, and by 6.1% in February, Detroit’s casino market reached an all-time high in March after generating $138.6 million in revenue, representing their best month since they first opened for business back in 1999. April (+2.5%), May (+3.9%) and June (+5.3%) subsequently rounded off a solid second-quarter in which revenue was up by 3.9% year-on-year at $367.9 million, and by 1.9% for the year so far.

Reasons for Growth

Since the Great Recession that started in December 2007 drew to a close in June 2009, there has been a steady improvement in the country’s economy, with a corresponding resurgence noted in Detroit’s casino market. As a result, more jobs have become available in the city, leading to more disposable income for people to spend on entertainment, including visiting Detroit’s selection of casinos.

Furthermore, while bankruptcies, vacant houses, and increasing crime statistics initially contributed to falling property prices and rents during the downturn, many of these properties in the city center were bought by entrepreneurs looking to take advantage of the rock-bottom prices. This has led to a major revival in the area, with people coming from all around to visit its cocktail bars, restaurants, and acclaimed arts-and-culture attractions. Casinos have also benefited greatly from this influx of tourists over the last few years, many of whom visit the venues for a fritter after their night out eating and drinking.

Caesars Windsor Casino Closure

Detroit’s casino market has received a further surge in Canadian tourists, who were previously able to meet their gambling requirements by visiting the Caesars Windsor Casino located in Canada’s southernmost city. The venue is situated directly across the river from Detroit, but for the past few months has been shuttered due to an ongoing
wage dispute with casino staff belonging to Unifor Local 444.

Needless to say, the closed casino has proved to be a boon for Detroit, although that situation could soon change once an agreement is eventually reached between Caesars Windsor Casino and its 2,300 workers. That said, Detroit casinos are making the most of the situation by taking the opportunity to market directly to Canadian residents, and offering them incentives to come across the border and gamble at their establishments. It is safe to say that many will still be inclined to continue frequenting Detroit’s casinos and taking advantage of such incentives and promotions once things do finally return to normal at the Caesars Windsor Casino.