We have just over two weeks of data on Caesars Danville Casino, and it’s already looking to become the top revenue-earner in The Old Dominion.
Caesars became the third Virginia casino last month, opening its doors on May 15. In 17 days, it produced $11.9 million in adjusted gross revenue, accounting for more than 26% of the state’s casino revenue.
The temporary gaming space under a big tent houses 740 slot machines and 53 live and electronic table games. A permanent casino and hotel are set to open in 2024.
Casino opening crushes expectations
During a press conference in March, Danville City Manager Ken Larking announced that the new Caesars Danville Casino would bring an expected $12.1 million in revenue for the city in its first year. Nearly $8 million was expected from tax revenue, which boils down to around $667,000 per month. The rest would come from increased tourism.
The Virginia Lottery’s report shows that one-third of all tax revenue goes to the host cities of Virginia casinos. With these numbers, the new casino would need to generate $24 million in taxes in its first year.
Casino revenue comes at an 18% tax rate, meaning the city estimated $133.3 million in casino profits during that time.
Caesars’ partial-month revenue of $11.9 million returned $2.1 million in taxes, earning the city of Danville $716,000. In other words, the city earned more than its monthly expectation in two-and-a-half weeks.
And these numbers are as temporary as the casino structure facilitating them.
When the full casino opens in 2024, the city expects that estimate to more than triple to $39 million, attracting around 2 million tourists annually.
Daily revenue makes a case for Caesars
May’s revenue set a record for Virginia’s young casino industry, which has only existed since Bristol Casino – future home of Hard Rock – opened in July 2022. Bristol’s May revenue was $12.9 million, barely $1 million more than Caesars despite a full month of reporting.
Rivers Casino Portsmouth, the only full-service casino in Virginia, opened on Jan. 23. It brought in more than $9 million in its first nine days and overtook HR Bristol in February when it produced $24.7 million in revenue during its first month of operation.
This equated to $1 million daily, a number it has yet to match since. It’s also a number Caesars did not come close to in its first 17 days, averaging $701,000 per day in revenue. However, Rivers’ permanent facility has almost double the slots and table games offerings of Caesars’ temporary one.
Furthermore, these numbers must account for the hype surrounding each casino’s grand opening. Rivers’ revenue has dropped every month since February, and it is on pace to have its first month below $20 million in June unless that trend changes.
- February: $24.7 million ($881,000 per day)
- March: $23.6 million ($762,000 per day)
- April: $21.3 million ($711,000 per day)
- May: $20.6 million ($665,000 per day)
As you can see, Caesars’ $701,000 per day outpaced Rivers’ $665,000. While Caesars enjoyed the same early hype as Rivers, a month at that rate would have equated to $21.7 million, making it the top casino by 5.4%.
More of a case for No. 1
Multiple factors give Caesars a legitimate chance to be Virginia’s top revenue-earning casino.
In the short term, it will continue to experience an early surge from opening, similar to Rivers. Rivers’ revenue trajectory in recent months suggests a regression to the mean, lowering the bar for Caesars to overtake.
Longer term, the casino’s $650 million permanent home will bring new draws, including a casino to rival Rivers in size and a 500-room hotel, 2,500-seat theater, convention center and spa.
The casino also has an edge location-wise, isolated from both other casinos. Danville is three-and-a-half hours west of Portsmouth and an equal distance east of Bristol.
It sits near the North Carolina border, less than an hour from Greensboro and slightly farther from Raleigh and Durham. The combined population of these metro areas exceeds 2 million.
Portsmouth sits within the Hampton Roads metro area, with a population of about 500,ooo fewer at 1.7 million. But if you consider that Danville sits a little over two hours from Charlotte, the scales tilt even further.
In fact, Caesars will bring so much business from North Carolina that a recent study showed it could poach as much as $259 million in annual gaming revenue from the state.
More competition will soon enter the ring
Virginia’s three casinos have distinct markets, but plenty of the state remains up for grabs.
That will change soon enough, as two more casinos will open within the next few years.
Norfolk’s HeadWaters Resort & Casino will open its casino in 2024, with a full-scale resort to follow a year later. It will become the fourth casino, with a fifth approved to open in Richmond soon after.
Of these properties, the new Norfolk casino will provide the most competition, given its proximity to Rivers Casino Portsmouth. Hampton Roads is Virginia’s largest metro area outside of DC, but local competition could lower both casinos’ ceilings.
At the end of the day, both casinos will find enough business to do well. But the two biggest winners will be Caesars and the state.