Fitch: Twin River affected by Plainridge opening

PLAINRIDGE PARK CASINO is expected to deliver solid return on investment for the next three years, or at least until Wynn Everett opens in 2018, according to Fitch Ratings. / COURTESY PLAINRIDGE PARK CASINO
PLAINRIDGE PARK CASINO is expected to deliver solid return on investment for the next three years, or at least until Wynn Everett opens in 2018, according to Fitch Ratings. / COURTESY PLAINRIDGE PARK CASINO

PLAINVILLE, Mass. – Twin River Casino in Lincoln will continue to get “considerable business from Massachusetts,” but it will be less and at a lower margin due to the recent opening of Plainridge Park Casino, according to Fitch Ratings.
Fitch analysts recently visited Plainridge Park Casino, as well as Twin River and the tribal casinos in Connecticut – Foxwoods and Mohegan Sun – to gauge the impact of Plainridge on existing gaming facilities.
Twin River was busy during the late afternoon on a Thursday when Fitch analysts visited, with license plates split evenly between Rhode Island and Massachusetts. Management told Fitch that it has not lost many customers to Plainridge yet, Fitch said.
“However, the Twin River customers from Massachusetts are now spending less as part of their gambling budget is spent at Plainridge. Management expects to lose some Massachusetts customers after the trials, but expects to retain the bulk of the Rhode Island players due to proximity and Twin River’s amenities, which generally exceeded Fitch’s expectations,” the release stated.
Fitch said the visit to Plainridge, which opened June 24, confirmed its view that it will deliver solid return on investment for the next three years, or at least until Wynn Everett opens in 2018.
Fitch, in a news release, said the effect on Connecticut casinos is expected to be “modest,” said Fitch, adding Foxwoods will see more of an impact than Mohegan due to its closer proximity.
Plainridge is expected to generate $176 million in revenue and $44 million in profitability, until Wynn Everett’s opening. That represents an 18 percent ROI, allowing Penn to cover more than 60 percent of project cost before additional competition comes on line, Fitch said.
The analysts visited Plainridge on a Friday morning, noting that almost all license plates in the garage were from Massachusetts. Management said approximately 20 percent of business comes from Rhode Island.
“Penn is aggressively marketing in both states with the intent to build a seasoned database by the time other Massachusetts casinos open,” Fitch said, noting that projects in Boston and Springfield are expected to open in late 2018.
“The southeast region license remains in limbo as the regulators decide whether to award it to a commercial operator or wait until Mashpee Wampanoag Tribe gets its land placed into trust by the Department of Interior, a prerequisite for casino construction,” Fitch continued.

Fitch also gave its opinion about Plainridge’s layout, saying the slot floor “felt a bit tight, the high limits area could easily be overlooked and there was no VIP area – perhaps reflections of Penn’s disciplined $250 million all–in budget.”
“Management indicated that they are still reconfiguring the gaming floor, putting in more video poker to meet strong demand for the product,” Fitch said.
Fitch also said food and beverage offerings provided a “good price point and atmosphere mix.”

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