Atlantic City Casino Smoking Ban Would Harm Gaming Revenues Up To 25 %, Analyst Projects

Atlantic City Casino Smoking Ban Would Hurt Gaming Revenues Up To 25 Percent, Analyst Tasks

Posted on: Could 2, 2022, eleven:53h.&nbsp

Final up to date on: May 2, 2022, 01:00h.

An Atlantic City casino smoking ban would have a devasting consequence on gaming revenue, or so says an analyst at CBRE Equity Analysis.

Atlantic City casino smoking ban New Jersey
An Atlantic City casino guest smokes a cigarette whilst playing a slot machine. While a coalition of anti-smoking supporters is developing, a ban on indoor casino smoke would negatively impact gaming revenues, 1 analyst says. (Picture: AP)

John DeCree, a senior analyst at Union Gaming, a subsidiary of CBRE given that 2021, tasks that a complete ban on indoor casino smoking at Atlantic City’s nine casinos would negatively impact annual gross gaming income (GGR) by as much as twenty%-25%.

New Jersey lawmakers carry on to mull legislation that would finish the smoking loophole afforded to the casinos and beneath the state’s clean air law passed in 2006. Currently, Atlantic City casinos can permit smoking on up to 25% of their gaming floor. But DeCree says people smoking spaces are exactly where upwards of 50% of the annual GGR is produced.

This is consistent with our study above the years that typically reveal smoking sections in casinos create substantially larger win per days than non-smoking sections,” DeCree wrote.

DeCree adds that because Atlantic City is largely a drive-in destination, the East Coast gaming mecca relies heavily on gamblers from Philadelphia and New York. Outlawing cigarettes, the Union Gaming analyst causes, would outcome in some of people players opting for casinos in which smoking stays permitted in Pennsylvania and Connecticut.

Quarter Income at Stake

A growing coalition of Atlantic City casino staff argue that it is lengthy previous due to get rid of indoor smoking on the gaming floors. The motion has acquired bipartisan help in Trenton, where at least 43 elected lawmakers have lent their names to Senate Bill 264/Assembly Bill 2151. The payments are clones of one one more, and each seeks to extinguish casino smoking.

The Casino Association of New Jersey, nevertheless, says this kind of a ban would hurt the market and end result in substantial task layoffs. The trade group earlier this 12 months commissioned a examine on the consequences of banning cigarettes. That report, carried out by Spectrum Gaming Group, also identified that a smoking ban would harm GGR in a similar projection as the one particular issued this week by DeCree.

DeCree adds that the twenty%-25% negative gaming revenue forecast is conservative.

“Atlantic City have to pull its clients away from much more conveniently-situated gaming options, and the absence of smoking would depart many of its greater value smoking buyers without purpose to make the trip,” Decree said. “For people smoking customers who do nonetheless make the trip to Atlantic City, smoking breaks would very likely consider longer relative to regional casinos, provided the dimension and scale of Atlantic City casinos, resulting in a better reduction of Time on Device (TOD) – a essential metric in gaming income.”

Data Proof

Atlantic City casino staff argue that a smoking ban would not hurt gaming as much as the sector and analyst believes. But even if it would, they say their wellness ought to get precedence above GGR and earnings.

DeCree says the economic wellness of the 9 casinos would be anticipated to suffer in wake of a comprehensive smoking prohibition. The analyst pinpoints many other markets where casino smoking was eliminated and the GGR impact they every single endured in the 1st twelve months right after the regulatory implementation.

DeCree cites Harrah’s New Orleans seeing its income plummet 20% following the city-instituted smoking ban went into effect in April of 2015. Similarly, Chicagoland casinos in Illinois saw their GGRs decline 22% right after a smoking prohibition was instituted in January of 2008.

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