Philadelphia Casino Application Review September 24, 2013 AKRF.COM - PowerPoint PPT Presentation

Philadelphia Casino Application Review September 24, 2013 AKRF.COM

AKRF’s Analysis Objectives 1. Third-party review of applications “Normalize” estimates 2. Competitive effects → net fiscal revenue 3. 4. Induced growth

Local Economic Impacts Construction-Period Benefits - Jobs Tota tal l constr struction tion-period riod em emplo loyme yment r t ranges fr s from m 2,00 ,000 to to over r 5,00 ,000 job jobs* s* 3,803 441 1,142 Wynn Philadelphia 1,413 174 441 Live! 2,045 233 607 The Provence Direct Indirect 1,869 220 567 Market 8 Induced 1,164 136 351 Casino Revolution 1,506 174 451 Hollywood Casino - 1,000 2,000 3,000 4,000 5,000 6,000 Person-Years of Employment * T Total l developm lopment cost sts s range fr from $4 m $428 mil milli lion to $92 $926 mil milli lion

Local Economic Impacts Operating Benefits - Jobs Tota tal l perma manent t emp mplo loyme yment r t ranges fr s from m 1,50 ,500 to to over 3,00 r 3,000 j jobs 1,682 304 350 Wynn Philadelphia 1,064 216 250 Live! 2,241 386 462 The Provence Direct Indirect 1,458 262 307 Market 8 Induced 1,231 238 281 Casino Revolution 1,068 208 245 Hollywood Casino 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Full-Time Equivalent (FTE) Jobs

Gaming Revenues and Potential Competition  Key factors: 1. Market trends 2. Program 3. Location

Gaming Revenue Trends in Eastern Pennsylvania 2007 - Current Reven enue ue tr tren ends s ds sug ugge gest st mar market et is is app pproa oaching hing sa satur turation tion $1,400 Total gaming Revenues by Casino - Semi Annually Valley Forge $1,200 Sugarhouse Sands Bethlehem Penn National $1,000 Mount Airy Harrah's Philadelphia $800 Parx Millions Monhegan Sun $600 $400 $200 $0

Program Comparison Pr Prog ogramme ammed d ar area eas s ran ange ge fr from om app pproxima ximatel tely y 16 160,00 0,000 0 to to 70 700,00 0,000 0 squa square f e fee eet* t* 180,000 Wynn Philadelphia Gaming Floor Restaurant, Bar & 71,582 Live! Lounge Nightclub 122,947 The Provence Event & Meeting Space 116,820 Market 8 Hotel 112,250 Casino Revolution Retail Recreation & Fitness 104,650 Hollywood Casino - 200,000 400,000 600,000 800,000 Square Feet * E * Exclud udes es ba back-of of-ho house, use, cir circu culation on, pu publi blic ar c area eas s an and par d parking king

Applicants’ Project Locations The he ne next ca xt casi sino no wil will l be be within within a 10 a 100-mil mile e rad adius ius of of 22 oth 22 other ca er casi sino nos. s. Local and Regional Local & Regional Analysis Assessment

Projected Gross Annual Gaming Revenues in $Millions Reven enue ue estima estimates tes fr from om app pproxima ximatel tely y $3 $375 75 mil milli lion on to to $4 $475 75 mil milli lion on Wynn Philadelphia Live! High The Provence Market 8 Casino Revolution Hollywood Casino $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 Wynn Philadelphia Live! Low The Provence Market 8 Casino Revolution Hollywood Casino $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 Slots Tables

Projected Net New Annual Gaming Revenues City of Philadelphia – in $Millions Reven enue ue estima estimates tes ran ange ge fr from om app pproxima ximatel tely y $2 $275 75 mil milli lion on to $4 to $400 00 mil milli lion on Wynn Philadelphia Live! High The Provence Market 8 Casino Revolution Hollywood Casino $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 Wynn Philadelphia Live! The Provence Low Market 8 Casino Revolution Hollywood Casino $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 Slots Tables

Annual Non-Gaming Revenues Revenue esti stima mate tes s range fr from m approxima imate tely y $40 mil milli lion to to $200 mill million ion Wynn Philadelphia Live! The Provence Market 8 Casino Revolution Hollywood Casino $- $50 $100 $150 $200 $250 Millions of Dollars Restaurant, Lounge, and Bar Entertainment, Event, and Meeting Space Hotel Retail Parking

Total Revenues (gaming + non-gaming) Ran ange ge i in n no non-ga gaming r ming reven enue ue amo amoun unts ts to to ga gaming r ming reven enue ue ac across oss the the pr projec ojects ts Hollywood Casino Market 8 Casino Revolution $45 $28 $83 $320 $247 $298 The Provence Live! Wynn Philadelphia $38 $201 $138 $435 $301 $283 Gaming Revenue Non-Gaming Revenue

Gaming Tax Revenues – Commonwealth of PA Tax r revenue esti stima mate tes s range fr from m approxima imate tely y $160 mill million ion to to $190 mill million ion Wynn Philadelphia Live! High The Provence Market 8 Casino Revolution Hollywood Casino $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 $200 Wynn Philadelphia Live! The Provence Low Market 8 Casino Revolution Hollywood Casino $0 $20 $40 $60 $80 $100 $120 $140 $160 $180 $200 Slots Tables

Gaming Tax Revenues – City of Philadelphia Tax ax r reven enue ue estima estimates tes ran ange ge fr from om app pproxima ximatel tely y $9 $9 mi mill llion ion to to $1 $14 4 mil milli lion on Wynn Philadelphia Live! High The Provence Market 8 Casino Revolution Hollywood Casino $0 $2 $4 $6 $8 $10 $12 $14 $16 Wynn Philadelphia Live! The Provence Low Market 8 Casino Revolution Hollywood Casino $0 $2 $4 $6 $8 $10 $12 $14 $16 Slots Tables

Potential for Induced Development Pr Proposed Pr oposed Projects ojects in F in Four our Ar Areas of eas of t the Cit he City Wynn Philadelphia 1 3 The Provence 1. North Broad Street Corridor The Provence 2 2. Market East Corridor Market 8 Market 8 3. Waterfront District Wynn Philadelphia 4. Stadium District Live! Hollywood Casino Casino Revolution Hollywood Casino Live! Casino Revolution 4

Potential for Induced Development Pr Projec oject t Cha harac acterist teristics ics With ith Pote otential ntial to to In Indu duce ce Develop elopmen ment Program Attributes Design & Locational Attributes (Attract wide audience: gaming & non-gaming) Retail Integrated into Existing Urban Fabric Restaurants and Bars Pedestrian Access/Foot traffic Entertainment Public Transit Accessible Hotels and Spa/Resort amenities Proximity/Synergy with other attractions ▶ Provides synergy with existing business and attractions ▶ Creates authentic urban entertainment destination environment ▶ Appeals to broad customer base (gaming/non-gaming and local/non-local) ▶ Improves ability to attract additional market interest in the area

Potential for Induced Development The he Philade Philadelphia lphia Op Oppo portun tunity ity: : Based ased on on P Pop opula ulation, Phil tion, Philad adelph elphia T ia Trails ails Oth Other er Major ajor Citi ities es in in the the Numb Number er of of R Restau estauran ant, t, Bar ars, s, an and d Reta etail il Of Offering erings* s* Location No. Residents No. Eating & Per 1,000 Drinking Places Residents Manhattan 1, 585,873 4,220 2.7 Boston 617,594 1,276 2.1 Restaurants & Bars San Francisco 805,235 2,232 2.8 Washington, DC 601,723 1,209 2.0 Philadelphia 1,526,006 2,398 1.6 Location No. Residents Retail Per 1,000 Businesses Residents Manhattan 1, 585,873 9,399 5.9 Retail Boston 617,594 1,642 2.7 San Francisco 805,235 3,229 4.0 Washington, DC 601,723 1,342 2.2 Philadelphia 1,526,006 3,519 2.3 * Source: Esri

Potential for Induced Development The he Pr Proven ence ce an and M d Mar arket et 8 pr 8 projec ojects h ts have e si simil milar ar cha harac acterist teristics ics to to po poten tentiall tially y indu induce ce ad additiona ditional l de develop elopmen ment t in in the the C Cen enter ter City ity ar area eas s whe here e the they y ar are e loca located ted The Provence Urban Mixed-use Casino, Hotel, Retail, and Entertainment Destination 4 Accelerate revitalization of North Broad Street Corridor from City Hall to Temple University Market 8 Urban Mixed-use Casino, Hotel, and Entertainment Destination 4 Activate Market East Corridor Inducement Indicators 4 Proximity to Convention Center 4 Synergy between project and other city cultural/historic destinations 4 Mixed-use development program that can attract broad audience (gaming/non-gaming, local/non-local) 4 Projects are physically integrated into urban fabric – activates street, generates foot traffic = perception change 4 Potential sites for spin-off projects (surface parking lots and underdeveloped/vacant buildings) Issues 4 The Provence: market absorption of proposed retail and entertainment program in one-phase 4 Market 8: appeal of multi-level casino to gaming customers (not widely practiced in industry)