Georgia Gaming Market Assessment - Pennsylvania Treasury

The following chart zooms in on the effects of the 2010 introduction of SugarHouse on the
Eastern market and recent adjustments in supply. The sharp increase in September marks the
opening of the casino. Demand shows a steady growth line (with the exception of heavy snow
storms in December and January), indicating that SugarHouse was being absorbed. Some
Eastern facilities took slot machines off the floor beginning in February, in response to
SugarHouse and to make room for table games, resulting in a dip in supply. The growth in
demand and the dip in supply have brought the two lines close together as of April.
% Change
15.0%
13.0%
11.0%
9.0%
7.0%
5.0%
3.0%
1.0%
-1.0%
Source: PGCB, The Innovation Group
Percentage Change in Slot Revenue vs. Change in
Supply (August 10 - April 11)
SugarHouse
Sept 10
Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 Apr-11
% Change in Revenue % Change in Supply
Philadelphia Submarket
The Philadelphia submarket is represented by Parx Casino, Harrah’s Chester Downs and the
recently opened Sugar House Casino. The Philadelphia market is generates the most revenue
and has the second largest supply of machines. The Philadelphia market, because of its mainly
urban locations has the highest WPU in the state. Both Park and Chester Downs opened in a
month of each other and showed relatively flat, but still positive revenue growth. The increase in
revenue shown beginning in September 2010 is explained by the opening of Sugarhouse which
grew the overall market but also cannibalized Parx and Chester, diluting the WPU.
The Innovation Group Project #054-11 August 2011 Page 36