Solid business seen as Coast casinos continue recovery, rebuilding

Mississippi Business Journal, The, Feb 26, 2007 by Lofton, Lynn

In spite of obstacles, the Mississippi Gulf Coast gaming industry is alive and well. Some casinos are still repairing and renovating and several have gaming in temporary quarters. The Biloxi-Ocean Springs bridge is out and that hampers visitors driving in from the east. Also, many employees still struggle with housing and insurance issues.

However, Larry Gregory, excutive director of the Mississippi Gaming Commission, says the gaming industry is faring well in the wake of the storm. "Comparing the last quarter of 2006 with the same time frame in 2004, gross gaming revenue is up $9 million," he said. "This is very positive in that the numbers reflect a 40% decrease in casino floor square footage as well as a 40% decrease in hotel rooms over pre-Katrina numbers."

Due to the hurricane's damage, revenue figures for 2005 cannot be used for comparison to those for 2006. But, Gregory says that amazingly, numbers are holding steady and revenues have been back to the pre-Katrina levels since September 2006.

He remains optimistic about the future of the industry. "Mere is no doubt in my mind that the future for gaming on the Gulf Coast is strong," he said. "They built back safer and smarter. This area will return to be a destination for tourists while providing much needed jobs. As a matter of fact , I predict the gaming industry in Mississippi will break the $3-billion mark in 2007."

The winter months are traditionally a slow time for Coast casinos but properties are not reporting much of a seasonal factor this year.

"Business is much better than we had anticipated," said Kathy Santiago, director of marketing at Treasure Bay Casino and Hotel in Biloxi. "Head counts have increased and the number of new enrollments (in the players' club) has steadily increased over the past couple of months."

She said it's difficult to get a count on how many Snowbirds are returning to the area. "The number of out-of-town players has increased, but considering we lack hotel rooms, it's hard to measure the number of actual snowbirds."

Snowbirds and others are finding their way to the Island View Casino in Gulfport, according to Rick Carter, managing partner of the property. He also said Island View has seen increased business since December. "In fact, the first two weeks in February have been among our busiest weeks yet," he said. "We are seeing a record number of visitors not only on the gaming floor but in the hotel and buffet, as well."

Bill Kilduff, vice president and general manager of the Isle of Capri Casino Resort in Biloxi, is very encouraged by the rebuilding on the Gulf Coast and the economic impact this growth has on the gaming industry and the region.

"Opening the (Biloxi-Ocean Springs) bridge will allow guests easier access to our property, which will definitely have an impact on our business," he said. "Even more so, I think that opening the bridge will signify an enormous step forward for development of the Coast and the commitment to rebuild."

Kilduff said the Isle of Capri has developed relationships through the years with loyal. guests from all over the country, especially from Florida, Alabama and Mississippi where guests reside permanently and with snowbirds who make the region their winter home.

"The feedback has been positive. They are happy to see that our resort is open and they can return to the Coast for a fun, exciting gaming and vacation destination once again" he added.

Even through the winter months, business has been great at the Beau Rivage, according to Mary Cracchiolo, director of public relations. "Our customers have come back and we've gained new customers," she said. "The convention market is strong, too, and we have a lot of packages."

Revenue at the Biloxi property helped boost 2006 fourth quarter earnings for the Beau Rivage's parent company, MGM Mirage, to a record high. The Beau had net revenue of $89 million, compared to $77 million for the fourth quarter of 2004.

The Grand Casino Biloxi reports that gaining is busy and the hotel has a high occupancy rate. "We're a different property now," said Ali Bass, communications manager. "We're a Harrah's property and participate in Harrah's quarterly promotions. That helps keep rooms booked and things busy."

The IP Casino Resort's general manager Jon Lucas says that although the business has some seasonality, there hasn't been a slowdown at his property, which was the first Coast casino to reopen after the hurricane.

"Things are going well and they will get better," he said. "Business will begin picking up now and on into the spring and summer. We won't see snowbirds like we have in the past because of the lack of facilities, but I do see a lot of RVs in our parking lot."

He is optimistic about the future of the industry in the area even though rebuilding is slow. "There isn't a lot of noncasino building going on, but I'm starting to see it now as I drive around and that's encouraging."