‘Everything could change.’ When will Mississippi Gulf Coast casinos reopen?
He doesn’t know when casinos across Mississippi will get the go-ahead to reopen, but Allen Godfrey said Mississippi has the advantage of knowing how to reopen casinos.
“Opening a casino is something we’ve done on a regular basis,” said Godfrey, executive director of the Mississippi Gaming Commission. “Reopening a casino is not the issue in South Mississippi as it is in a lot of places,” he said.
While the reopening is easy from a technical standpoint, Godfrey said, Gov. Tate Reeves will need to ease some regulations and give the Gaming Commission some direction. “And then the commission will take it from there,” he said.
While Reeves is allowing some businesses to open with restrictions, he told MSNBC Thursday, “We don’t think that the gaming market is ready to reopen yet.”
Reeves said in a press conference Friday that casinos have a disadvantage of a drawing large numbers of people but the advantage of having large facilities so people can spread out for social distancing. He said he expects casinos won’t open until the Gaming Commission the State Health Department are all on the same page about the timing.
In Nevada, where the coronavirus pandemic forced the first industry shutdown since the 1963 assassination of President Kennedy, the Nevada Gaming Board this week issued a 6-page plan for reopening casinos and club venues.
In South Mississippi, all 12 casinos were closed for months following Hurricane Katrina and have closed many times for hurricanes on the Coast and flooding on the Mississippi River.
“The resilience part is not in question,” said Keith Crosby, general manager at Palace Casino in Biloxi. South Mississippi’s casino industry and employees have proven they are resilient, he said. And unlike 2005 when Katrina tore apart many of the casinos, he said this time the buildings are still intact.
A new casino world
Reopening won’t restore Mississippi casinos to what they were when the Gaming Commission ordered them closed on March 16. The casinos may reopen with thermal temperature scans of employees and staff, masks, social distancing placement of slot machines and with buffets closed or dramatically changed.
“Everything from how often we clean to how we greet our guests could and will change,” said Bill Hornbuckle, chief executive officer of MGM Resorts International, parent company of Beau Rivage Resort & Casino in Biloxi. “Our casino floors will look different and our restaurants ultimately will be impacted as well,” he said in a video message.
While the casino operators are eager to reopen, Crosby said, “The last thing we want to do is to open up and have something happen.”
Booking a stay
It’s possible to make a reservation for early May at Golden Nugget Biloxi and other casinos on the Coast. But that doesn’t mean the casinos or their hotels will open that soon.
Crosby said they have people booking hotel reservations at Palace Casino, and week by week their staff is having to call to cancel those reservations.
“There seems to be continued interest in booking rooms,” he said, and those who are having to cancel casino and golf packages at The Preserve Golf Club are rescheduling for fall.
Interest in room reservations doesn’t mean people immediately will return to the casinos, the hotels, golf courses and restaurants once they reopen.
“Our expectations swing from extreme one side to extreme the other side,’ Crosby said. Reality probably will land in the middle, he said, with some customers eager to return and others not ready to venture out.
How long before normal?
Looking at how the casino industry has bounced back from other disasters, the coronavirus is the first disruption that has affected the whole world at the same time, Robert Heller, CEO of Spectrum Gaming Capital, said during a webinar Thursday.
He thinks this recovery will be slower than after Katrina, he said, in part because customers are going to be frightened to return.
It was four months after Katrina that the first casinos reopened in South Mississippi. It wasn’t until the 1-year anniversary that the Beau Rivage, the largest casino in Mississippi, reopened and revenues bounced back to near pre-Katrina levels.
While many Coast casinos were closed in 2005 and part of 2006, the inland casinos in Mississippi had a surge in business, said Geoff Atkinson, senior data analyst at Management. He said a similar bounce could happen if one state reopens casinos while they are closed in a neighboring state due to the coronavirus.
That happened in Florida after Hurricane Irma, when one casino was back open in a couple of days and it took a neighboring casino eight months.
“It’s a big advantage if your casino is open and your competitor’s casino is not,” Atkinson said.
After the 9/11 attacks, Atlantic city saw a decline for only three months, Heller said, even with its proximity to New York. It took Vegas years to recover, Heller said, because of the disruptions and fear of air travel.
During the national recession that began around 2007, the Las Vegas strip decline was substantially greater than other markets, said Heller, because it is a destination market where half the visitors arrive by air.
“The lack of visitors was painful,” he said.
Heller said these experiences show, “...regional markets are going to perform better and gamblers will gamble.”
Costing everyone
“Maybe in the end it’s all economics,” Heller said about how soon casinos will reopen.
Out of the 130,000 people receiving unemployment in Mississippi many of them are casino employees. The industry employed more than 16,500 people statewide in February.
As revenues at MGM fell 29% in the first quarter, 60,000 of its 69,000 employees were furloughed due to the coronavirus.
“I make good money at the casino,” said one employee at the Beau Rivage, who asked not to be identified. She finally was able to get unemployment benefits after weeks of trying to get through to Mississippi Department of Employment Security.
“I’m managing with it,” she said of the benefits, “but I would love to go back to work.”
Also being lost is the tax money from the casinos. In what was supposed to be one of the best months of the year with March Madness sports betting, casino revenue fell to $14 million on the Coast compared to $33 million in March 2019. Revenues dropped to $110 million at state casinos from $212 million last year.
For April the revenue will be 0, meaning millions of lost revenue for the state, the counties, cities, and local school districts, fire and police.
Once the casinos reopen, Atkinson said restoring confidence and getting people to come back will be most important. How to space slot machines becomes a secondary issue, he said
And people gradually will return once the casinos reopen, history has shown.
“When people come back to life they want to go have fun,” Heller said.
This story was originally published April 25, 2020 at 6:00 AM.
