Detroit Casinos See August Revenue Dip, Want Poker Rooms Back
In the first month after reopening since the COVID-19 shutdown, the three Detroit casinos reported losses for August in a year-by-year comparison.
But two of the casinos didn’t reopen until Aug. 5 and one on Aug. 7, and all reopened at 15% capacity.
Compared to August 2019, revenue fell 46% to $28.6 million at MGM Grand Detroit, 37.5% to $25 million for MotorCity and 41.5% to $15.7 million at Greektown. Total, the Detroit casinos reported $69.3 million aggregate revenue.
After a 4½-month shutdown due to COVID-19 health concerns, Gov. Gretchen Whitmer issued an executive order on July 29 allowing casinos to reopen under strict health and safety guidelines. MotorCity and Greektown reopened on Aug. 5, and MGM Grand reopened to the public on Aug. 7.
Michigan Gaming & Taxes
Over the past two decades, Detroit casinos have paid more than $2.2 billion to Michigan, designated for public schools. During August, the three Detroit casinos paid $5.6 million in taxes to the state, compared to $9.7 million for the same month last year.
The three casinos also reported $1.97 million in qualified adjusted gross receipts during August. The qualified adjusted gross receipts are the gross sports betting receipts minus the monetary value of free play incentives provided to and wagered by the bettors. MGM reported $932,601, while Greektown reported $551,176 and MotorCity was at $493,275.
Michigan Poker Rooms Want to Reopen
In an attempt to return to normalcy, two of the Detroit casinos are planning to reopen their poker rooms.
MotorCity Casino recently sent out an email to its customers, stating “Detroit’s best Poker Room reopens NEXT WEEK!” According to The Detroit News, the email went out last week, meaning MotorCity is looking to reopen its poker rooms this week.
A spokesman for Penn National Gaming, which operates Greektown Casino, mentioned to The News that its hope is to have poker rooms “back up in a few weeks.”
The reopening of the poker rooms has been news to the Michigan Gaming Control Board. Spokesperson Mark Kay Bean said in an email that any plans to reopen poker rooms must get approval from the board.
“Poker will not resume at the Detroit casinos until the casinos’ management submits plans that comply with Gov. Gretchen Whitmer’s workplace safety executive order and the MGCB’s minimum reopening guidelines order,” Bean said. “The MGCB must approve the casinos’ plans on how social distancing and other health and safety requirements will be met. It is the same approach used prior to the reopening of the casinos.”
Bean also notes the MGCB must approve the casinos’ plans on how social distancing and other health and safety requirements will be met, which is the same approach that was used prior to the reopening of the casinos. Any request that meets the standards in both the governor’s orders and the agency’s minimum reopening guidelines order will be considered by the MGCB.
The MGCB executive order on casino minimum reopening guidelines addresses table games in Section V. It states there will be a limit of three players at each poker table. Other measures include:
MGM Grand Detroit has announced no immediate plans to reopen its poker room.
Poker rooms in Las Vegas have been open for weeks, but instead of the typical nine-player allotment allowed, the tables have been limited to five- or six-handed, max. Some casinos have recently gone to eight-handed, but with plexiglass dividers between each player.
Recent Layoffs at Casinos
Both MGM Detroit and Greektown have recently announced layoffs. On Sept. 1, MGM Detroit laid off about 1,100 employees as part of MGM’s nationwide downsizing plan, which included the release of 18,000 furloughed workers.
“While we have safely resumed operations at many of our properties and returned tens of thousands of our colleagues to work, our industry — and country — continues to be impacted by the pandemic, and we have not returned to full operating capacity,” Bill Hornbuckle, MGM CEO, wrote in a letter to employees.
A week later, on Sept. 8, Greektown laid off 43 workers due to revenue loss from the COVID-19 pandemic. By comparison, the layoffs at Greektown were not as drastic compared to MGM Detroit; Greektown employs over 2,000 people, while MGM Detroit employs about 2,800.
“These layoffs at Greektown Casino-Hotel are the unfortunate result of COVID-19 related business circumstances that were sudden, dramatic and beyond our control,” John Drake, vice president and general manager of Greektown Casino-Hotel, said in a letter to the state. “The impact on our business was not reasonably foreseeable until now.”