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September 21, 2019Cart

Business

by Fairfield County Business Journal
by FCBJ

MGM Resorts falls short in first-year gambling revenue at Springfield casino

MGM Resorts International, still shut out of Connecticut’s gaming industry for the time being, is also now dealing with a significant shortfall at its MGM Springfield casino resort in Massachusetts, which observes its first anniversary in business on Aug. 24.

During its first year of operations, the casino resort generated $252.8 million in gambling revenue for the period ending July 31, according to figures released by the Massachusetts Gaming Commission. That is below the projected $412 million that the company projected for its first year in Springfield.

MGM Springfield President and Chief Operating Officer Mike Mathis acknowledged that the company was not wholly successful in attracting Connecticut gamblers away from Foxwoods and Mohegan Sun.

“This market has some really strong competitors that have been in the market for 20-plus years,” Mathis said during a press conference. “I think we may have underestimated that level of loyalty, and what it would take for those customers to give us a shot.”

Mathis added that initial gambling revenue projections were made several years earlier  and that the local market conditions have changed. He also noted that while the venue met its initial goal of employing 3,000 individuals when it opened last year, it now has a workforce of 2,300.

“The people that I’ve spoken to, and our team has spoken to, are thankful for the 2,300,” Mathis said. “These are 2,300 great jobs, well-paying, with benefits, and we’re launching careers. Sure, we’d love the number to be higher, because it would be a reflection that the business is higher, and that will come with time.”

MGM Resorts proposed building a casino resort in Bridgeport in September 2017, but has been unable to change state law that gives exclusive rights to casino operation to the Mohegan and Mashantucket Pequot tribes.

Gov. Ned Lamont had requested the company and the tribes work together on an equitable solution, but the tribes ignored his directive. A bipartisan bill introduced last month called the Connecticut Jobs and Revenue Act (CJRA) would enable a tribal-operated casino in Bridgeport, provided that the tribes to allocate a minimum of $100 million toward a projected $300 million venue. In comparison, the MGM Bridgeport project was presented as a $675 million project funded entirely through private capital.

Two weeks ago, MGM sued the U.S. Department of Interior to nullify its approval for the tribes to build a $300 million casino on nontribal land in East Windsor, Tribal Winds, a few miles across the state border from the Springfield casino. Lamont had lobbied the tribes to drop the East Windsor project in exchange for exclusive right to Connecticut’s online gaming rights and a casino license for Bridgeport, but the tribes rejected the offer by citing the $20 million they already invested in the East Windsor project. The CJRA reaffirmed the Tribal Winds project in East Windsor while continuing the prohibition against nontribal entities from operating in this sector.