Two down-but-not-quite-out companies have joined forces in a last attempt to regain their footing in the Massachusetts casino race. Suffolk Downs, scrambling to get a new partner and a new casino plan, has chosen Mohegan Sun to help it get to the finish line. Mohegan Sun spent years promoting its casino vision for Palmer, but voters there rejected it by the narrowest of margins. A recount done yesterday confirmed the loss by 94 votes.
The new Suffolk proposal faces numerous hurdles – a looming deadline, the threat of lawsuits no matter what happens, and a pending decision by the Massachusetts Gaming Commission on whether to accept a Revere-only project, to name a few.
Mohegan Sun and Foxwoods, already facing steep declines in their Connecticut slot business, both eyed Massachusetts based on the old adage, ‘If you can’t beat them, join them.’ Despite a history of staggering debt loads and other financial issues, the two companies forged ahead. Foxwoods is now out of the Bay State race with last week’s rejection by voters in Milford, but Mohegan Sun is reborn. Since both companies have been in the news so much, I thought I’d revisit recent revenue trends at their home properties.
In most months, Mohegan Sun has fared better than Foxwoods in terms of slot revenue. Year to date through October, Foxwoods slot revenue is down 8.3 percent, while Mohegan Sun is down 6.1 percent. In calendar year 2012, Foxwoods slot revenue was down 9.0 percent from 2011, compared to an 8.4 percent decline for Mohegan Sun. Recently, Mohegan Sun actually posted the first monthly gains over the previous year seen at either facility in a very long time – its slot revenues were up marginally in August and by one percent in October. Sure that’s not much, but given the sea of negatives year after year, it’s something.
The two facilities have been hammered by competition in New York in particular, and haven’t really been able to rebound after the recession took its toll on most gaming properties around the country. Combined, they lost 27 percent of their slot revenue from 2007 to 2012; only Atlantic City suffered a worse fate among all mature American casino markets during that time period. Foxwoods and Mohegan Sun have a narrow window of opportunity to recapture some of that lost revenue before the Massachusetts properties spring to life, when they will likely suffer an additional blow.