Two-decade agreement
Golden Nugget Online Gaming (GNOG) now has access to the New York market after partnering with the Tioga Downs Race Track. This deal will provide GNOG with the ability to launch an offering in the state if online casinos become legal. Naturally, the launch would be dependent on receiving all of the necessary licensing and regulatory approvals.
GNOG announced this 20-year deal on Wednesday, with Tioga Downs to get a share of the net gaming revenue. The agreement includes minimum royalty payments.
We will remain focused on securing new market access partners in more US states.”
GNOG president Thomas Winter spoke about how New York is a key component of the company’s growth strategy and that it looks forward to the region launching online gambling. He also said: “We will remain focused on securing new market access partners in more US states.”
Tioga Downs owner Jeffery Gural is confident that GNOG will be able to launch an exciting offering in New York in the future that will create new revenue streams for the two partners, as well as for the state. Speaking about what GNOG brings to the table, he said it has “experienced online teams, a historied US casino brand and a proven track record in our neighboring state of New Jersey.”
A potentially lucrative market
New York State has almost 19.5 million residents, making it the fourth most populated US state. It represents a potentially lucrative market for operators, with GNOG estimating that gross gaming revenue in the state could reach $2bn annually for a mature online casino market.
Neighboring states Pennsylvania and New Jersey have seen a lot of success since launching regulated online gambling in recent years. Little to no progress on legalizing online casinos, however, has been made to date in New York. Operators like GNOG are partnering with local casinos now in anticipation of getting the green light in the future.
GNOG is coming off a record year in the New Jersey market; it also recently launched in Michigan. This latest deal in New York represents the ninth state that in which GNOG has gained access. The company went public at the end of 2020 after merging with a special purpose acquisition company (SPAC). GNOG’s total revenue for 2020 was over $90m, up from $55.4m in 2019.
Online sports betting looking likely
New York Governor Andrew Cuomo announced last month that he is in favor of allowing statewide online betting. Previously, the governor opposed the idea and he preferred confining sports betting to retail casinos in the region. Now, though, New York is facing a significant budget deficit and is looking at ways to boost state revenue.
Online casinos are seemingly not under serious consideration in the state at the moment. Legal online sports betting looks a lot likelier, with two legalization bills currently in the legislature. Some betting operators are now looking to gain market access.
Arlington International Racecourse site for sale
Tioga Downs is not the only US racetrack that has been making moves. Churchill Downs Incorporated (CDI) announced on Tuesday that it is looking to sell its 326-acre site at Arlington Heights, home of the Arlington International Racecourse.
CDI will still be going ahead with the 2021 races at the track
Commercial real estate service firm CBRE will be representing CDI in this sale. CDI will still be going ahead with the 2021 races at the track between April and September, as it does not expect the potential sale to impact these events. The site is in the Chicago suburbs and is accessible to downtown via the rail system.
CDI CEO Bill Carstanjen believes that there will be robust interest in the sale opportunity. He also underlined that CDI is “very committed to pursuing the relocation of Arlington’s racing license to another community in the Chicagoland area or elsewhere in the state.”
CDI owns the Churchill Downs Racetrack, the host venue for the annual Kentucky Derby. It also owns and operates the TwinSpires gambling brand. As well as having its long-running TwinSpires online horse racing betting offering, CDI is moving its BetAmerica sportsbooks and online casinos under the TwinSpires brand.