potential impact of new casinos on existing sparks, nevada casinos
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Potential Impact of New Casinos
On Existing Sparks, Nevada Casinos
Potential Impact of New Casinos
On Existing Sparks, Nevada Casinos
September 28, 2005 Presentation to:AD HOC Committee on Non-restricted
Gaming
The City of Sparks, Nevada
Prepared By:
Wells Gaming Research495 Apple Street, Suite 205
Reno, NV 89502
September 28, 2005 Presentation to:AD HOC Committee on Non-restricted
Gaming
The City of Sparks, Nevada
Prepared By:
Wells Gaming Research495 Apple Street, Suite 205
Reno, NV 89502
August 2005 Wells Gaming Research Slide 2
Potential Impact of New Casinos on Existing Sparks Casinos
Scope of Work Current Status & Trends - Tribal Gaming Impact Demographic Projection 1,440 square miles to 2010 Gravity Model - Local Gaming Market
Player Counts Existing Casinos - Meeting With Management Local Market Attraction Factors
Survey of Sparks Gamblers Potential New Casino Locations 7 in Sparks, 2 in Reno Estimate Impact on Existing Sparks Casinos
August 2005 Wells Gaming Research Slide 3
Figure 1-1 Five Year Compound Growth Rate in Gaming Revenues
Washoe County - All Non-Restricted Locations 1980 - 2004
-0.02
-0.01
0
0.01
0.02
0.03
0.04
0.05
0.06
0.07
0.08
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Washoe Co.
IGRA1988
67 Tribal Casinos Open in CA(38), WA(21), & OR(8)
CA Prop 5March 2000
Economic SlowdownJan 2001
Silver Legacy OpenedJuly 1995
Source: Wells Gaming Research
Thunder Valley
Opened Jun 2003
911
54 CACasinos
12/04
89 Tribal CasinosCA,WA,OR
First Wave of Tribal Casinos
Second Wave
Potential Impact of New Casinos on Existing Sparks Casinos
August 2005 Wells Gaming Research Slide 4
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-10Washoe County Gaming vs. RetailAnnual Revenue -Fiscal Years in $Millions
$3,500$3,750$4,000$4,250$4,500$4,750$5,000$5,250$5,500$5,750$6,000$6,250$6,500
1996 1997 1998 1999 2000 2001 2002 2003 2004
$900$925$950$975$1,000$1,025$1,050$1,075$1,100$1,125$1,150$1,175$1,200
Retail Gaming
Retail Sales Gaming Win
August 2005 Wells Gaming Research Slide 5
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 1-2Summary of Casino Statistics for Washoe County
for 1995, 2000, & 12 Months Ended June 30, 2005
Before Proposition 1-A After Proposition 1-A
Gaming Statistics 1995 2000% Chg
1995 -200012-Months
Ended 6-2005
% Chg 2000 -12 months
Ended 6-2005
% Chg 1995 -12 months
Ended 6-2005
Player Counts 10,913 10,123 -7% 6,798 -33% -38%
Number of Locations 48 40 -17% 37 -8% -23%
Gaming Capacity
Slot Machines 29,324 28,698 -2% 23,729 -17% -19%
Table Games 989 836 -15% 662 -21% -33%
Win per Unit
Slot Machines $64 $80 25% $90 13% 41%
Table Games $623 $790 27% $779 -1% 25%
Gaming Revenues
Slot Machines $687,784,000 $839,516,000 22% $777,902,000 -7% 13%
Table Games $224,740,000 $241,635,000 8% $188,208,000 -22% -16%
Total $972,599,000 $1,128,851,000 16% $1,006,056,000 -11% 3%
Data Sources: Nevada GCB Monthly Revenue Reports & WGR, July 2005.
August 2005 Wells Gaming Research Slide 6
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-1 Casinos in US 2003 - 2004
Type of Casino# of
States# of
CasinosRevenue in
Billions of $'s
Commercial Casinos 11 443 $27.0
Racetrack Casinos 8 15 $2.2
Tribal Casinos 28 330 $16.7
Total 35 788 $45.9
Data Sources: American Gaming Association, National Indian Gaming Association, & Wells Gaming Research.
August 2005 Wells Gaming Research Slide 7
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-2Annual Gaming Revenue for Tribal Casinos Located in Region II 1
(Dollars in Thousands)
Description# of
Casinos Gaming Revenues Change % Change
1999 - WGR 39 $1,200,000
FY 2001 - NIGC 48 $2,891,522 $1,691,522 141%
FY 2002 - NIGC 51 $3,678,095 $786,573 27%
FY 2003 - NIGC 54 $4,699,889 $1,021,794 28%
FY 2004 - NIGC 52 $5,788,332 $1,088,443 23%
Footnote 1 : The National Indian Commission includes California & northern Nevada in Region II even through there are no Tribal casino located in northern Nevada.
Data Sources: National Indian Gaming Commission & Wells Gaming Research, August 2005.
August 2005 Wells Gaming Research Slide 8
Potential Impact of New Casinos on Existing Sparks Casinos
Figure F2-11Airline Passengers Deplaned at Reno-Tahoe International
Airport
Final Destination - Reno-Tahoe Jan 96 through Jul 05
125,000
150,000
175,000
200,000
225,000
250,000
275,000
300,000
325,000
350,000
375,000
Jan-96Mar-96May-96Jul-96Sep-96Nov-96Jan-97Mar-97May-97
Jul-97Sep-97Nov-97Jan-98Mar-98May-98Jul-98Sep-98Nov-98Jan-99Mar-99May-99
Jul-99Sep-99Nov-99Jan-00Mar-00May-00Jul-00Sep-00Nov-00Jan-01Mar-01May-01
Jul-01Sep-01Nov-01Jan-02Mar-02May-02Jul-02Sep-02Nov-02Jan-03Mar-03May-03
Jul-03Sep-03Nov-03Jan-04Mar-04May-04Jul-04Sep-04Nov-04Jan-05Mar-05May-05
Jul-05
Airline Passengers Deplaned at Reno-Tahoe International Airport
Deplaned
Sept-ll-2001Data Source: Airport Authority of Washoe Co., Chart by WGR
American buys Reno Air1998 - Aug 1999
Trend: Down 75 k per month or 27%, but turning up
August 2005 Wells Gaming Research Slide 9
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-3Closest California Tribal Casinos
Existing & Future Casinos
Casino Name# of Slots
# of Tables
# of Rooms
Player
Counts1
Utilization Percent
Est Gaming
Rev/Yr2
Existing Casinos$'s in
Millions Jackson Rancheria 1,854 41 146 792 37% $141
Thunder Valley 2,929 94 0 1,417 40% $375
Cache Creek 2,486 129 200 1,206 36% $332
Total Existing 7,269 264 546 3,415 38% $848
Future Casinos San Pablo 2,500 100 0 $400
Foothill Oaks 2,000 80 250 $194
Total Future 4,500 180 250 $594
Grand Total 11,769 444 796 $1,442
Reno / Sparks Total 20,236 592 15,175 6,071 24% $894
(1) Player counts conducted Nov-Dec 2004.
(2) All revenue estimates by WGR except Foothill (by developers).
Data Source: Wells Gaming Research, January 2005.
August 2005 Wells Gaming Research Slide 10
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-4Potential Impact of Two New Northern California Casions
to the Reno/Sparks Gaming Market
Casino# of
Gamblers# of
Annual TripsEstimated Gross Gaming Revenue
San Pablo -33,135 -99,404 -$14,910,660
Shingle Springs -9,071 -27,212 -$3,401,539
Total -42,206 -126,617 -$18,312,199
Source: Wells Gaming Research.
August 2005 Wells Gaming Research Slide 11
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 1-5 Summary of Population & Median Household Income Projections
Population Subregions 2000 2004 2005 2006 2007 2008 2009 2010
Avg Annual Growth
Rate 2000-2005
Avg Annual Growth
Rate 2005-2010
Total Population 338,954 390,709 399,531 411,310 422,547 433,876 443,557 451,586 3.3% 2.5%
Adult Population 240,405 276,690 282,731 290,726 298,322 306,084 312,784 318,377 3.3% 2.4%
Median Household Incomes:
Subregions $49,301 $56,987 $59,089 $61,268 $63,528 $65,871 $68,300 $70,819 3.7% 3.7%
State of Nevada $44,581 $51,547 $53,452 $55,428 $57,477 $59,601 $61,805 $64,089 3.7% 3.7%
US $41,994 $48,005 $49,638 $51,326 $53,072 $54,877 $56,744 $58,674 3.4% 3.4%
Data Sources: Bureau of Business & Economics, UNR & Wells Gaming Research, August 2005.
August 2005 Wells Gaming Research Slide 12
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 1 - 3 Sparks Casino Gaming Revenues for 2005
Comparison of Total Revenues with Local Market Revenues
(In Thousands of Dollars)
Gaming Revenues Dollar Amount
Total Gaming Revenues for 11 Non-restricted Locations in Sparks for the 12 Months Ended June 30, 2005 $161,876
Estimated 2005 Gaming Revenues from Local Residents at 10 Existing Casinos $109,088
Percent of Sparks Gaming Revenues that are Generated by Local Residents 67%
Data Source: Wells Gaming Research, August 2005.
August 2005 Wells Gaming Research Slide 13
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 1 - 4Estimated Impact of Potential New Casinos in 2010On the Gaming Revenues of Ten Existing Sparks Casinos
In Millions of Dollars
Single Casino ScenariosLow
ImpactHigh
ImpactLow % Impact
High % Impact
Scenario 1 Tierra Del Sol -$13.4 -$21.1 -10% -16%
Scenario 2 Sparks Galleria -$5.6 -$14.2 -4% -11%
Scenario 3 Copper Canyon -$2.2 -$6.2 -2% -5%
Scenario 4 Wingfield Springs -$8.6 -$15.9 -7% -12%
Scenario 5 Downtown Sparks -$1.2 -$2.9 -1% -2%
Scenario 6 Steamboat Station -$3.1 -$4.1 -2% -3%
Scenario 7 Convention Station -$3.8 -$7.1 -3% -5%
Multiple Casino ScenariosLow
ImpactHigh
ImpactLow % Impact
High % Impact
Scenario 8 = Casinos 1 & 2 -$16.8 -$28.2 -13% -22%
Scenario 9 = Casinos 1, 2, & 3 -$18.3 -$31.5 -14% -24%
Scenario 10 = Casinos 1 & 6 -$16.5 -$25.1 -13% -19%
Scenario 11 = Casinos 1, 3, 6, & 7 -$21.1 -$34.1 -16% -26%
Scenario 12 = Casinos 1, 2, 3, 6, & 7 -$24.3 -$40.2 -19% -31%
Scenario 13 = All Seven Casinos -$27.5 -$44.2 -21% -34%
Source: Wells Gaming Research, August 2005.
$24.6 &19%
$37.0 &29%
Expanded Scope of Tierra Del Sol
Announced Sept 23, 2005
August 2005 Wells Gaming Research Slide 14
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-1Scenario 1 - One New Casino - Tierra Del Sol
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are BuiltYear 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Tierra Del Sol is BuiltYear 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $106,307,000 $109,671,000 $112,718,000 $115,512,000
Impact on 10 Existing Sparks Casinos $0 $0 -$11,173,000 -$11,933,000 -$12,705,000 -$13,400,000
% Impact -10% -10% -10% -10%
High Case - One New Casino - Tierra Del Sol is BuiltYear 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $99,749,000 $102,716,000 $105,392,000 $107,854,000
Impact on 10 Existing Sparks Casinos $0 $0 -$17,731,000 -$18,888,000 -$20,031,000 -$21,058,000
% Impact -15% -16% -16% -16%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 15
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-1aRevised Scenario 1 - One New Casino - Tierra Del Sol
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
With increased attraction factors for Peppermill and Tierra Del Sol
Base Case - If No New Casinos are BuiltYear 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Tierra Del Sol is BuiltYear 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $101,174,000 $104,257,000 $107,042,000 $109,600,000
Impact on 10 Existing Sparks Casinos $0 $0 -$16,306,000 -$17,347,000 -$18,381,000 -$19,312,000
% Impact -14% -14% -15% -15%
High Case - One New Casino - Tierra Del Sol is BuiltYear 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $96,590,000 $99,422,000 $101,974,000 $104,325,000
Impact on 10 Existing Sparks Casinos $0 $0 -$20,890,000 -$22,182,000 -$23,449,000 -$24,587,000
% Impact -18% -18% -19% -19%
Data Source: Wells Gaming Research, Revised September 27, 2005.
August 2005 Wells Gaming Research Slide 16
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-2Scenario 2 - One New Casino - Sparks Galleria
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Sparks Galleria is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $112,600,000 $116,481,000 $120,066,000 $123,343,000
Impact on 10 Existing Sparks Casinos $0 $0 -$4,880,000 -$5,123,000 -$5,357,000 -$5,569,000
% Impact -4% -4% -4% -4%
High Case - One New Casino - Sparks Galleria is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $105,014,000 $108,532,000 $111,773,000 $114,733,000
Impact on 10 Existing Sparks Casinos $0 $0 -$12,466,000 -$13,072,000 -$13,650,000 -$14,179,000
% Impact -11% -11% -11% -11%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 17
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-3Scenario 3 - One New Casino - Copper Canyon
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Copper Canyon is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $119,541,000 $123,269,000 $126,673,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 -$2,063,000 -$2,154,000 -$2,239,000
% Impact -2% -2% -2%
High Case - One New Casino - Copper Canyon is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $115,902,000 $119,472,000 $122,733,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 -$5,702,000 -$5,951,000 -$6,179,000
% Impact -5% -5% -5%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 18
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-4Scenario 4 - One New Casino - Wingfield Springs
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Wingfield Springs is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $113,993,000 $117,291,000 $120,322,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 -$7,611,000 -$8,132,000 -$8,590,000
% Impact -6% -6% -7%
High Case - One New Casino - Wingfield Springs is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $107,368,000 $110,273,000 $112,941,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 -$14,236,000 -$15,150,000 -$15,971,000
% Impact -12% -12% -12%
Data Source: Wells Gaming Research, September 2005
August 2005 Wells Gaming Research Slide 19
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-5Scenario 5 - One New Casino - Downtown Sparks
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Downtown Sparks is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $116,422,000 $120,514,000 $124,295,000 $127,757,000
Impact on 10 Existing Sparks Casinos $0 $0 -$1,058,000 -$1,090,000 -$1,128,000 -$1,155,000
% Impact -1% -1% -1% -1%
High Case - One New Casino - Downtown Sparks is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $114,884,000 $118,916,000 $122,653,000 $126,065,000
Impact on 10 Existing Sparks Casinos $0 $0 -$2,596,000 -$2,688,000 -$2,770,000 -$2,847,000
% Impact -2% -2% -2% -2%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 20
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-6Scenario 6 - One New Casino - Steamboat Station
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Steamboat Station is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $118,836,000 $122,479,000 $125,823,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 -$2,768,000 -$2,944,000 -$3,089,000
% Impact -2% -2% -2%
High Case - One New Casino - Steamboat Station is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $117,897,000 $121,488,000 $124,790,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 -$3,707,000 -$3,935,000 -$4,122,000
% Impact -3% -3% -3%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 21
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-7Scenario 7 - One New Casino - Convention Station
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - One New Casino - Convention Station is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $121,728,000 $125,130,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 $0 -$3,695,000 -$3,782,000
% Impact -3% -3%
High Case - One New Casino - Convention Station is Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $118,524,000 $121,848,000
Impact on 10 Existing Sparks Casinos $0 $0 $0 $0 -$6,899,000 -$7,064,000
% Impact -6% -5%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 22
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-8Scenario 8 - Two New Casinos - Tierra Del Sol & Sparks Galleria
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Two New Casinos - Tierra Del Sol & Sparks Galleria
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $103,237,000 $106,485,000 $109,426,000 $112,125,000
Impact on 10 Existing Sparks Casinos $0 $0 -$14,243,000 -$15,119,000 -$15,997,000 -$16,787,000
% Impact -12% -12% -13% -13%
High Case - Two New Casinos - Tierra Del Sol & Sparks Galleria
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $93,219,000 $95,980,000 $98,472,000 $100,762,000
Impact on 10 Existing Sparks Casinos $0 $0 -$24,261,000 -$25,624,000 -$26,951,000 -$28,150,000
% Impact -21% -21% -21% -22%
Data Source: Wells Gaming Research, September 2005
August 2005 Wells Gaming Research Slide 23
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-9Scenario 9 - Three New Casinos - Tierra Del Sol, Sparks Galleria, & Copper Canyon
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Three New Casinos - Tierra Del Sol, Sparks Galleria, & Copper Canyon
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $103,237,000 $105,032,000 $107,921,000 $110,572,000
Impact on 10 Existing Sparks Casinos $0 $0 -$14,243,000 -$16,572,000 -$17,502,000 -$18,340,000
% Impact -12% -14% -14% -14%
High Case - Three New Casinos - Tierra Del Sol, Sparks Galleria, & Copper Canyon
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $93,219,000 $92,834,000 $95,225,000 $97,415,000
Impact on 10 Existing Sparks Casinos $0 $0 -$24,261,000 -$28,770,000 -$30,198,000 -$31,497,000
% Impact -21% -24% -24% -24%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 24
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-10Scenario 10 - Two New Casinos - Tierra Del Sol & Steamboat Station
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Two New Casinos - Tierra Del Sol & Steamboat Station
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $106,307,000 $106,922,000 $109,791,000 $112,442,000
Impact on 10 Existing Sparks Casinos $0 $0 -$11,173,000 -$14,682,000 -$15,632,000 -$16,470,000
% Impact -10% -12% -12% -13%
High Case - Two New Casinos - Tierra Del Sol & Steamboat Station
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $99,749,000 $99,061,000 $101,514,000 $103,789,000
Impact on 10 Existing Sparks Casinos $0 $0 -$17,731,000 -$22,543,000 -$23,909,000 -$25,123,000
% Impact -15% -19% -19% -19%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 25
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-11Scenario 11 - Four New Casinos - 2 in Sparks & 2 in Reno
Tierra Del Sol, Copper Canyon, Steamboat Station & Convention StationEstimated Impact on Gaming Revenues
For 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Four New Casinos - Tierra Del Sol, Copper Canyon, Steamboat, & Convention Ctr.
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $106,307,000 $105,381,000 $105,227,000 $107,769,000
Impact on 10 Existing Sparks Casinos $0 $0 -$11,173,000 -$16,223,000 -$20,196,000 -$21,143,000
% Impact -10% -13% -16% -16%
High Case - Four New Casinos - Tierra Del Sol, Copper Canyon, Steamboat, & Convention Ctr.
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $99,749,000 $95,398,000 $92,735,000 $94,813,000
Impact on 10 Existing Sparks Casinos $0 $0 -$17,731,000 -$26,206,000 -$32,688,000 -$34,099,000
% Impact -15% -22% -26% -26%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 26
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-11aRevised Scenario 11 - Four New Casinos - 2 in Sparks & 2 in Reno
Tierra Del Sol, Copper Canyon, Steamboat Station & Convention StationEstimated Impact on Gaming Revenues
For 10 Existing Sparks Casinos
With increased attraction factors for Peppermill and Tierra Del Sol
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Four New Casinos - Tierra Del Sol, Copper Canyon, Steamboat, & Convention Ctr.
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $101,174,000 $100,202,000 $99,970,000 $102,289,000
Impact on 10 Existing Sparks Casinos $0 $0 -$16,306,000 -$21,402,000 -$25,453,000 -$26,623,000
% Impact -14% -18% -20% -21%
High Case - Four New Casinos - Tierra Del Sol, Copper Canyon, Steamboat, & Convention Ctr.
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $96,590,000 $92,434,000 $89,895,000 $91,878,000
Impact on 10 Existing Sparks Casinos $0 $0 -$20,890,000 -$29,170,000 -$35,528,000 -$37,034,000
% Impact -18% -24% -28% -29%
Data Source: Wells Gaming Research, September 27, 2005.
August 2005 Wells Gaming Research Slide 27
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-12Scenario 12 - Five New Casinos - 3 in Sparks & 2 in Reno
Tierra Del Sol, Sparks Galleria, Copper Canyon, Steamboat Station, & Convention StationEstimated Impact on Gaming Revenues
For 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Five New Casinos - Tierra Del Sol, Galleria, Copper Canyon, Steamboat, & Convention
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $103,237,000 $102,329,000 $102,154,000 $104,604,000
Impact on 10 Existing Sparks Casinos $0 $0 -$14,243,000 -$19,275,000 -$23,269,000 -$24,308,000
% Impact -12% -16% -19% -19%
High Case - Five New Casinos - Tierra Del Sol, Galleria, Copper Canyon, Steamboat, & Convention
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $93,219,000 $89,356,000 $86,798,000 $88,729,000
Impact on 10 Existing Sparks Casinos $0 $0 -$24,261,000 -$32,248,000 -$38,625,000 -$40,183,000
% Impact -21% -27% -31% -31%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 28
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 3-13Scenario 13 - Seven New Casinos - 5 in Sparks & 2 in Reno
Tierra Del Sol, Sparks Galleria, Copper Canyon, Wingfield Springs, Downtown Sparks, Steamboat Station, & Convention Station
Estimated Impact on Gaming RevenuesFor 10 Existing Sparks Casinos
Base Case - If No New Casinos are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $117,480,000 $121,604,000 $125,423,000 $128,912,000
Low Case - Seven New Casinos - 5 in Sparks & 2 in Reno are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $102,417,000 $99,340,000 $99,082,000 $101,398,000
Impact on 10 Existing Sparks Casinos $0 $0 -$15,063,000 -$22,264,000 -$26,341,000 -$27,514,000
% Impact -13% -18% -21% -21%
High Case - Seven New Casinos - 5 in Sparks & 2 in Reno are Built
Year 2005 2006 2007 2008 2009 2010
10 Existing Sparks Casinos $109,088,000 $113,412,000 $91,551,000 $85,389,000 $82,866,000 $84,668,000
Impact on 10 Existing Sparks Casinos $0 $0 -$25,929,000 -$36,215,000 -$42,557,000 -$44,244,000
% Impact -22% -30% -34% -34%
Data Source: Wells Gaming Research, September 2005.
August 2005 Wells Gaming Research Slide 29
Potential Impact of New Casinos on Existing Sparks Casinos
Survey Highlights - 300 Sparks Gamblers Restricted Gaming - Sparky’s Type Facility:
• 63% visit• 56% dine• 20% show• 16% gamble
Non-restricted Gaming - Casinos with 16 or more slots: • 79% visit • 74% dine • 33% show • 32% gamble
August 2005 Wells Gaming Research Slide 30
Potential Impact of New Casinos on Existing Sparks Casinos
Survey Highlights - 300 Sparks Gamblers 2000 WGR survey - 53.3% of Sparks adults
gamble at casinos
Gambling frequency: • 4.7 times/month
• 55.9 times/year
Casinos where gambled most: • Sparks 63%
• Reno 37%
August 2005 Wells Gaming Research Slide 31
Potential Impact of New Casinos on Existing Sparks Casinos
Survey Highlights - 300 Sparks Gamblers Casinos where also gambled:
• Sparks 40%• Reno 60%
Reasons for selection of casino where gambled most:• Near where I live 24% • Went there to eat 22% • More comfortable 10% • Friendlier staff 10%
August 2005 Wells Gaming Research Slide 32
Potential Impact of New Casinos on Existing Sparks Casinos
Survey Highlights - 300 Sparks Gamblers Casino games played most often:
• Video poker 33%
• Video slots 29%
• Reel slots 22%
• Total slots 84%
• Table games 12%
• Other games 4%
August 2005 Wells Gaming Research Slide 33
Potential Impact of New Casinos on Existing Sparks Casinos
Survey Highlights - 300 Sparks Gamblers Theoretical casino win per visit $33.19 Gambling time per visit about 2 hours Gambling budget per visit $102 mean $40 median Sparks gambler’s views about new neighborhood
casinos:• For 59%• Against 39%
August 2005 Wells Gaming Research Slide 34
Potential Impact of New Casinos on Existing Sparks Casinos
Survey Highlights - 300 Sparks Gamblers Demographics:
• Average length of residence in Sparks 14 years
• Single family residence 72% Apt 17%
• Own home 75% rent 25%
• Gender female 65% male 35%
• Average age 52.5 years
• Average income $59,498
• Employed full time 47% part time 10%
August 2005 Wells Gaming Research Slide 35
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-5Reno/Sparks Player Counts
for 1995, 2000, & the 12 Months Ended June 2005
Before Proposition 1-A After Proposition 1-A
Player Counts 1995 2000
% Chg 1995 - 2000
12-Months Ended 6-2005
% Chg 2000 -12 months
Ended 6-2005
% Chg 1995 -12 months
Ended 6-2005
Reno / Downtown 6,714 5,704 -15% 2,992 -48% -55%
Reno / Other 2,214 2,510 13% 2,246 -11% 1%
Sparks 1,985 1,909 -4% 1,560 -18% -21%
Total 10,913 10,123 -7% 6,798 -33% -38%
Data Sources: Nevada GCB Monthly Revenue Reports & WGR, July 2005.
August 2005 Wells Gaming Research Slide 36
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-6 Number of Casino Locations
for 1995, 2000, & the 12 Months Ended June 30, 2005
Before Proposition 1-A After Proposition 1-A
Number of Locations 1995 2000% Chg
1995-200012-Months
Ended 6-2005
% Chg 2000 -12 months Ended 6-2005
% Chg 1995 -12 months
Ended 6-2005
Sparks 10 8 -20% 8 0% -20%
Reno 28 22 -21% 17 -23% -39%
Washoe County 48 40 -17% 37 -8% -23%
Data Sources: Nevada GCB Monthly Revenue Reports & WGR, July 2005.
August 2005 Wells Gaming Research Slide 37
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-7Gaming Capacity
for 1995, 2000, & the 12 Months Ended June 30, 2005
Before Proposition 1-A After Proposition 1-A
Gaming Capacity 1995 2000% Chg
1995-200012-Months
Ended 6-2005
% Chg 2000 -12 months Ended 6-2005
% Chg 1995 -12 months
Ended 6-2005
Slot Machines
Sparks 5,056 5,044 0% 4,588 -9% -9%
Reno 20,938 20,283 -3% 15,519 -23% -26%
Washoe County 29,324 28,698 -2% 23,729 -17% -19%
Table Games
Sparks 113 96 -15% 79 -18% -30%
Reno 772 644 -17% 507 -21% -34%
Washoe County 989 836 -15% 662 -21% -33%
Data Sources: Nevada GCB Monthly Revenue Reports & WGR, July 2005.
August 2005 Wells Gaming Research Slide 38
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-8 Win per Unit for Sparks, Reno, & Washoe County
for 1995, 2000, & the 12 Months Ended June 30, 2005
Before Proposition 1-A After Proposition 1-A
Win per Unit 1995 2000% Chg
1995-200012-Months
Ended 6-2005
% Chg 2000 -12 months Ended 6-2005
% Chg 1995 -12 months
Ended 6-2005
Slot Machines
Sparks $61 $77 26% $82 7% 35%
Reno $66 $82 24% $95 16% 45%
Washoe County $64 $80 25% $90 12% 40%
Table Games
Sparks $466 $506 9% $595 18% 28%
Reno $671 $875 30% $840 -4% 25%
Washoe County $623 $790 27% $779 -1% 25%
Data Sources: Nevada GCB Monthly Revenue Reports & WGR, July 2005.
August 2005 Wells Gaming Research Slide 39
Potential Impact of New Casinos on Existing Sparks Casinos
Figure 2-9Gaming Revenues for Sparks, Reno, & Washoe County
for 1995, 2000, & the 12 Months Ended June 30, 2005
Before Proposition 1-A After Proposition 1-A
Revenue 1995 2000% Chg
1995-200012-Months
Ended 6-2005
% Chg 2000 -12 months Ended 6-2005
% Chg 1995 -12 months
Ended 6-2005
Slot Machines
Sparks $113,116,000 $142,341,000 26% $137,939,000 -3% 22%
Reno $507,155,000 $610,218,000 20% $540,341,000 -11% 7%
Washoe County $687,784,000 $839,516,000 22% $777,902,000 -7% 13%
Table Games
Sparks $19,207,000 $17,764,000 -8% $17,168,000 -3% -11%
Reno $189,141,000 $206,271,000 9% $155,368,000 -25% -18%
Washoe County $224,740,000 $241,635,000 8% $188,208,000 -22% -16%
Totals
Sparks $139,010,000 $165,349,000 19% $158,904,000 -4% 14%
Reno $743,968,000 $854,587,000 15% $728,652,000 -15% -2%
Washoe County $972,599,000 $1,128,851,000 16% $1,006,056,000 -11% 3%
Data Sources: Nevada GCB Monthly Revenue Reports & WGR, July 2005.
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