American Indian-owned casinos in Oklahoma saw their revenue increase well above industry trends in 2013, according to a report released Monday.
Along the Arkansas state line, five of Oklahoma's tribes have large-scale casino operations. Many of the facilities have been upgraded in recent years, adding new or expanded casino floors and nongambling amenities such as hotels, restaurants and spas. The casinos operating along the border say gamblers from Arkansas and other neighboring states are a large part of their customer base.
Arkansas has no tribal-owned gambling, but betting is allowed on greyhound races at Southland Park in West Memphis and thoroughbred races at Oaklawn Park in Hot Springs. State law allows gambling on electronic devices at the racetracks similar to devices offered at out-of-state casinos.
Revenue from Indian-owned casinos nationwide was up in 2013, the fourth-consecutive year for growth, but it saw far less impressive gains compared with previous years.
The 479 gambling operations in 28 states generated $28.3 billion in gaming revenue, an all-time high but only an increase of 0.5 percent compared with the year before. The casinos saw an increase of 2 percent in total revenue in 2012 and a 3 percent gain in 2011, still well below the pre-recession gains of 7 percent in 2007, according to Casino City's Indian Gaming Industry Report.
Alan Meister, an economist with Nathan Associates Inc., which wrote the report, said a struggling economy and increased competition for gambling dollars hurt growth.
In 2013, Oklahoma had 124 gaming facilities, the most in the nation, many of them small, operated by 33 tribes. The total number of gambling machines increased 2.5 percent to just shy of 70,000 while the number of table games decreased by 3 percent to 785.
Oklahoma ranked second for total revenue with $3.7 billion for 2013, trailing California with $7 billion. Together the two states made up 38 percent of all revenue generated by Indian-owned casinos. Oklahoma ranked 10th for revenue growth with 1.7 percent.
Marc Anthony Fusaro, associate professor of economics at the College of Business at Arkansas Tech University in Russellville, said Oklahoma's ranking in revenue growth is misleading. He noted casino operations in the other states in the top 10 -- except Florida at No. 7 -- were tiny, allowing for small increases to register as greater revenue growth on a percentage basis.
He noted Oklahoma has been solidly in top-10 rankings for the past three years and that Florida, its closest competitor by size, didn't make the cut in 2012 or 2011.
"Oklahoma is strong at No. 2 and on a growth path to stay that way," Fusaro said.
In recent years, Indian-owned casino operations have added hotels and other nongambling-focused amenities. Across the United States, nongambling revenue was up nearly 5 percent to $3.6 billion. Nongaming revenue has outpaced gaming revenue in 10 of the past 13 years, according to the report.
Oklahoma is doing well in this area, Fusaro noted, pointing out the state saw its nongambling revenue increase nearly 14 percent in 2013, to $580.5 million.
The Cherokee Nation is building a casino hotel at Roland, on the Oklahoma border near Fort Smith along Interstate 40. Construction began in April 2014 on the $80 million project. It includes a six-story, 120-room hotel and gambling operation with 850 electronic games as well as table games. Plans also call for two dining options and an entertainment venue.
The casino is expected to open sometime in May and the hotel will be ready for guests in July.
In West Siloam Springs, Okla., the tribe operates Cherokee Casino & Hotel, which was upgraded in 2010 and now has 1,500 electronic games, table games and a 140-room hotel. In September, the Cherokee Nation said a casino hotel will be part of a $170 million retail development soon to begin in Tahlequah.
The Choctaw Nation also has a presence along the Arkansas border near Fort Smith. It expanded and enhanced the gambling floor at its Pocola casino on Interstate 540 in 2012 and added a 118-room hotel in 2013.
In 2012 in Wyandotte, Okla.,, the Eastern Shawnee of Oklahoma opened the Indigo Sky Casino, which includes a hotel.
In late 2013, the Wyandotte Nation said it was beginning a $7 million renovation of its casino in the northeast corner of Oklahoma, part of a broader, $30 million master project at the Wyandotte Nation Casino in Wyandotte.
In Quapaw, Okla., the Quapaw Nation operates the Downstream Casino Resort, which opened a 152-room hotel expansion in late 2012. The nation is planning a $15 million expansion built on what's now the casino's main parking lot. It will connect to the existing Downstream building, crossing the state line into Kansas.
Fusaro said the casinos that have built hotels and other amenities have seen that money return and are able to draw a more diverse customer base. He noted that many of the casino operations along the Arkansas line have come to the conclusion that they need to seek success in the mode of Las Vegas and Branson, where the payout doesn't come from gambling but from entertainment.
"There's only so much traffic you can draw from truckers traveling the Interstate," Fusaro explained. "These operations attract a wider audience."
Business on 03/31/2015