Could more Nevada casino operators expand to Colorado?
When gambling in Colorado was legalized in 1990, that didn’t seem like a viable option. Fast forward 32 years, and it’s a different story.
Amendment 77 gave more power to Colorado cities Black Hawk, Central City, and Cripple Creek. The amendment removed gambling limitations and allowed those cities to add more games.
The result? Colorado’s gaming revenue climbed to $1.23 billion in 2021. That’s the 14th-highest commercial gambling state, per the American Gaming Association.
“Getting rid of the betting limits and adding the games has expanded the market,” Maverick Gaming CEO Erick Persson told the Nevada Independent.
Maverick Gaming bought one Black Hawk Casino and two Central City properties in 2019 before the passing of Amendment 77. But his company was not the first Nevada-based group to acquire property in Colorado.
Ameristar Casinos bought and remodeled the property now known as Ameristar Black Hawk in 2004. Eldorado Resorts, based in Reno, Nevada, acquired the Isle of Capri Casinos in 2017 before rebranding it into Horseshoe Casino Black Hawk.
Why were Nevada casinos initially hesitant to expand to Colorado?
Colorado hasn’t always been the alluring gambling destination it is today. Previous legislation limiting maximum bets and certain casino games led to expansion hesitancy from casinos outside state lines.
When Colorado legalized gambling in 1991 in Black Hawk, Central City, and Cripple Creek, maximum bets were just $5. Blackjack, poker games, and slot machines were the only games allowed.
Amendment 50 changed things when Colorado voters approved the measure in 2008. It boosted the maximum bet from $5 to $100 and allowed the use of more casino games.
Colorado went on to legalize sports betting in 2020, and since then, that market has been a hit. More than $7.6 billion was wagered on sports since May 2020. Casino operators made $464.9 million off sports betting over that time frame, too.
“With its very low taxes and license fees and its liberal market access climate, Colorado is arguably the most favorable online sports betting operating environment in the US,” Eilers & Krejcik Gaming analyst Chris Krafcik told the Nevada Independent.
How could Colorado sports betting influence casino expansion?
Given the popularity of Colorado sports betting, it’s no stretch to believe the industry will continue to grow over the years.
“We think there is going to be a steady inflow of new supply in the coming years,” Krafcik told the Nevada Independent.
As of now, there are 22 licensed online sports betting operators and 15 retail sports betting operators in the state. And some of the industry’s biggest names are among the group.
DraftKings, Caesars, and FanDuel all have an online presence in Colorado. DraftKings has a physical sportsbook operation at Bally’s Black Hawk North Casino.
While Caesars has two locations: Isle Casino Hotel Black Hawk and Lady Luck Casino Black Hawk. Even Barstool Sports’ new sportsbook is available online and in-person at the Ameristar Casino Black Hawk.
Krafcik believes the state’s industry to be favorable to sports betting operators of all sizes and said:
“If you want to go head-to-head with one of the big three, that’s, of course, going to be very, very challenging. If you’re looking to proof-of-concept your product or showcase your capabilities in a US-regulated environment, then Colorado is an economical market in which to do so.”
What’s next for gambling in Colorado?
Many casino operators already in Colorado think drawing in more customers is a real possibility.
For example, in 2012, Reno-based Monarch Casinos purchased Riviera Black Hawk. Over the course of the next 10 years, the casino went through a complete renovation. It is now the Monarch Casino Resort Spa Black Hawk.
“This was an opportunity for us because Black Hawk didn’t have a high-end property,” Monarch Casinos CEO John Farahi. “For us, this opened the market to attract more high-end clients.”
Farahi added that land could be a question when it comes to outside parties coming to Colorado to “do something significant.” But, he did cite Amendment 77 as the main reason for his business’s ability to grow.
“With the betting limits lifted, we were able to expand the property and bring the high-end market to Black Hawk, which is something you couldn’t do before,” he told the Nevada Independent.