Hard Rock has identified New City as its next location for setting up a gambling operation. If their plans to build within the city do not go as planned, they will seek a location that is near the city of NY. While New York has not been in the limelight as a betting destination, the state has gambling regulations and a promising set of parameters.
This revelation comes amidst stories that the casino operator has already acquired all the necessary documentation required to set up a gambling operation in New Jersey. The distance between these two locations is roughly eight miles. According to the chairman of the global gambling, entertainment and Hospitality Company, which is owned by Florida’s Seminole Indian tribe, Jim Allen, Hard Rock is supposed to have submitted their expression of interest letter before 10th December.
According to gambling regulations passed for New York, only three casino operating licenses can be awarded for the downstate region. New York City falls under this region and one of these approvals may soon be granted to Hard Rock. The region is considered to be the Holy Grail of the state’s casino industry given its high population and wealth status.
While addressing the East Coast Gaming Congress in Atlantic City, Allen revealed that plans to set up a Hard Rock Gambling operation in New York have been ongoing for seven years since the market opened up. At an interview which was held on a different date, Allen denied claims that the company would be abandoning their early plan to unveil a casino at the Meadowlands Racetrack located outside New York City. Hard Rock had interest in both these locations and if all goes well, they will be happy running both set ups.
Before they establish a gambling base in the Meadowlands, the Hard Rock casino would have to wait for approval from the NJ electorate. In 2016, the voters of Garden State unanimously rejected a plan that had proposed building of casinos outside AC (this is the only area in NJ where casino premises are permitted).
Hard Rock casino made an investment of half-billion dollars in 2018 to set up in the Atlantic City area and Allen is optimistic that the two markets they are eyeing are capable of supporting a full-blown gambling sub-sector. He pointed out the fact that the nine major casinos operating in the AC area were doing really well, an indication that the market can accommodate a large number of operators at the same time.
A few weeks ago, the New York State Gaming Commission called upon all interested players to express interest for the awarding of the last three of casino licenses approved for the state of NY. Apart from Hard Rock, other major gambling brands that have expressed interest in launching business in New York are Las Vegas Sands, Wynn Resorts, Bally’s and Caesars Entertainment.
There is no previous data that investors can use to establish the profitability of the NY betting market and their best bet is to be part of the action.
The current state of the gambling market in NY is that there are already 4 casinos that have set up operations in the state. The call for the three is due to the fact that NY voters authorized the setting up of 7 casino outfits in the area in 2013. According to a gambling historian based at the University of Las Vegas Nevada, David Schwartz, metro NY city is quite robust and able to accommodate two properties of the same operator.
It is not yet clear whether Hard Rock will be partnering with other business entities in the region to set up a gambling operation. According to the owner of the Meadowlands Racetrack, Jeff Gural, and two other similar property owners in the upstate region of New York, there has been no word from Allen expressing interest in their properties.
There is high anticipation of a partnership because that has been the latest business expansion strategy for gambling companies in the US. This is especially common with companies just like Hard Rock that are looking to establish business in a new jurisdiction.
Even though the majority of people are of the opinion that two casino businesses owned by the same management would be successful operating so close to one another, there are some negative voices as well. A Democratic New Jersey state Assemblyman who is also a native of Northern NJ, Ralph Caputo, is quite pessimistic of the close proximity of the two Hard Rock Casinos. He is however quick to point out that the Meadowlands Racetrack in New Jersey has had such an impressive performance and this could be a reflection of what should be expected from the new premises.
The revenue collected from the Meadowlands gambling business by Hard Rock makes up for about half of the total sports betting revenue collected from the entire NJ state on a monthly basis. Two months ago, NJ broke the record as the first state in the United States to accumulate over $1 billion worth of sports betting wagers over one-month duration. Caputo is one of those who believe that New York has a large proportion of disposable income compared to other states and a casino business would thrive.
The idea of setting up a completely independent operation such that two chapters of the same company operate within an 8-mile radius is quite new. While there might be supporting factors that are an indication the idea will succeed, critics are crossing their fingers for it to flop. Whichever way the outcome will be, it will be a lesson for the entire industry for those who are considering a similar move in the future.
The Hard Rock brand is a familiar player in the gambling industry so they must have a strategy of how this new business model is going to work.