While the Pennsylvania Gaming Control Board won’t begin to applications for online gambling and truck stop terminals two to three months, Pennsylvania mini-casino licenses are rolling out quick. On Thursday, the PGCB revealed the latest auction winner when they revealed the third mini casino license, awarded to the same group that owns Mount Airy Casino in Eastern Pennsylvania.
Their $21.9 million bid means that the state has brought in over $111 million just from mini-casino licenses alone. And they are just getting started.
|Pennsylvania Mini Casino Auctions|
|1||January 10th||Penn National Gaming||Southern PA in Yoe, in York County||$50.1 million|
|2||January 24th||Stadium LLC||East of Pittsburgh in Derry Township (in xxxxxx County)||$40.1 million|
|3||February 8th||Mount Airy LLC||West PA in New Castle, near the Ohio border||$21.9 million|
Pennsylvania’s mini casino licenses in high demand
Pennsylvania’s existing casino operators thus far have been aggressive in bidding for the first licenses, with operators thus far bidding to protect existing turf and compete in new areas.
Auction #1 – Penn National Gaming
– With minimum bids for mini-casinos starting at $7.5 million, not many observers expected the $50.1 million price tag that Penn National bid on January 10th. But with a head-turning bid, Penn National outbid three other companies for the rights to put a mini-casino in southern Pennsylvania. The coordinates for the proposed location are centered around Yoe, Pennsylvania located in York county, some five miles south east of York.
Penn National’s large bid was not only a surprise for its size but also because of a January lawsuit filed against the state. Penn National had objections to rules of mini-casino locations that unfairly impacted the company’s Hollywood Casino located in Harrisburg. PA mini casino rules state that a mew mini casino must be located at least 35 miles from an existing casino. Due to Hollywood Casino’s relative remoteness, the company has argued that sites around the casino would be targeted.
By making the bid, Penn National is setting themselves up should (or when) the lawsuit fails. The location not only protects the company’s existing casino in Harrisburg but also provides an attractive location near the Maryland border where I-83 heads into Baltimore.
Auction #2 – Stadium LLC
After Penn National’s bid, expectations increased for what the second mini-casino auction would bring. On January 24th, Stadium LLC bid over $40 million for the second mini casino license, a figure that also impressed observers.
Stadium LLC, the company behind Philadelphia Live that is currently in development targeted the Pittsburgh suburbs. The location for the proposed site is in the Derry Township located in Westmoreland County near Greensburg. The significance of this location? The mini-casino will be around 25 miles east of Pittsburgh and provide competition to the Rivers Casino.
Auction #3 – Mount Airy LLC
In an auction that was initially delayed for weather, on February 8th the company behind the Mount Airy Casino won the rights to the third mini casino. With a $21.9 million bid, the company plans to place the casino in Western Pennsylvania in New Castle, located in Lawrence County.
The site is a prime location nestled between Pittsburgh to the south and Presque Isle Downs and Casino to the north with the Ohio border close by.
The next mini casino auction will be held on February 21st with subsequent auctions held every 2 weeks until all ten licenses have been awarded. Pennsylvania casinos are given the first opportunity for the licenses which start at a minimum bid of $7.5 million.
After all licenses have been sold to existing casinos, the auctions will be open to additional entities.
While the inflated bids we have seen thus far will likely decline as the auction process plays out, it seems to be clear that most, if not all, of licenses will be sold at levels not previously imagined.