Detroit Casinos post Best Year since 2012

Detroit’s three casinos – Greektown, MGM Grand and MotorCity – posted their first year-over-year revenue gains since 2012. Additionally, 2015 was the best year for Detroit in three years as well.

Back in 2012, Detroit’s casinos took a downturn when their neighbor to the south, Ohio, began opening their own casinos. But it seems that low gas prices and a better U.S. economy are sparking a turnaround with the city’s casinos.

“This is a business that is dependent almost entirely on discretionary income,” said Alex Calderone, who manages the Birmingham-based Calderone Advisory Group. “Money that’s not spent at the pump is money that can be spent at the casino.”

Another factor at play here is the automotive industry, which employs many workers in and around Detroit. Automotive companies had one of their best years ever, and unemployment dropped from 6.5% in 2014 to just 5.1% in 2015.

Looking closer at the casino numbers, Greektown, MGM Grand and MotorCity Casino combined for $1.38 billion in 2015 gambling revenue – up 3.3% from the previous year. As USA Today reports, 83% of this came from slot machines while the remaining 17% came from table games.

At this time, actual profits and numbers for non-gaming revenues haven’t been released. However, the gambling revenue increase is a nice sign for the beleaguered city, which declared bankruptcy in 2013.

The casino turnaround began happening at the end of 2014, when Michigan gas prices fell from $3.50 per gallon to around $2.00. There was almost an immediate boost in gambling revenue, which continued throughout 2015, as gas prices continued to stay low.

The end result is that Detroit will be getting a much-larger cut of the gambling revenue than in previous years. The 3 casinos will submit $174.3 million in taxes from 2015, which is $5.2 million more than Detroit’s government budgeted for.

Further good news for the city’s casino industry is that union workers signed another five-year contract, which offered $4,250 signing bonuses and wage increases in the fourth and fifth years.

Below you can see a complete look at Detroit casino gambling revenue numbers from last year, as provided by USA Today:

Detroit Annual Casino Revenue (3 casinos combined)
2015: $1.38 billion
2014: $1.33 billion
2013: $1.34 billion
2012: $1.42 billion
2011: $1.42 billion
2010: $1.37 billion
2009: $1.33 billion

Individual casino results for 2015 vs. 2014
MGM Grand Detroit: up 3.7% to $582 million
MotorCity Casino Hotel: up 4.4% to $464.5 million
Greektown Casino-Hotel: up 1% to $329.9 million

Related News