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LEAVING LAS VEGAS

Small-town casinos generate big retail sales, too

BY JOEL GROOVER

Before the advent of casino gambling in 1992, things were sleepy in Biloxi, Miss. How sleepy?

“After Labor Day, you could shoot a shotgun down Highway 90 at noon and never have to worry about hitting anybody,” jokes Marshall D. Staehling, Biloxi’s director of community development from 1994 to 2005. “If you look at the impact of gaming and what it has done for our city, it is a real Cinderella story.”

Staehling says Biloxi’s nine casinos have helped create 17,000 jobs and now draw 12 million visitors a year, compared with 1 million before the legalization of gambling. Thousands of these visitors wind up staying, so Biloxi is in the midst of a high-rise condominium boom, Staehling says.

Retail is doing well too. “We’re attracting people of middle- and upper-income that have real purchasing power,” Staehling said. “That definitely has an effect on retail, particularly the malls.”

Although it is the upscale casino-oriented retail developments in Las Vegas, such as The Forum Shops at Caesars, that tend to dominate the headlines, not every moneymaking opportunity in the sector lies there or in Atlantic City, N.J. Many can be found on Indian reservations or in smaller cities with legalized gambling.

According to the Washington, D.C.-based American Gaming Association, 445 commercial casinos in 11 states generated some $29 billion in gross gaming revenue last year. Fully one-quarter of the U.S. population, or 54.1 million Americans, made a total of 319 million casino trips during that time.

Those numbers help explain why Indian casinos such as the Mohegan Sun, in Uncasville, Conn., can generate sales that rival their big-city counterparts. “A lot of the tenants that we have in the Forum Shops are in the Mohegan Sun as well,” said Scott Gordon, president and director of New York City-based Gordon Group Holdings, which developed The Shops at Mohegan Sun for the Mohegan tribe. The project’s 42 shops and restaurants “are doing much greater than $600 per square foot,” said Gordon, “probably approaching the Forum Shops’ numbers.”