Cedar Rapids casino study shows Iowa already saturated

Posted: January 8, 2025, 09:03 pm.

Last updated: January 8, 2025, 09:03 pm.

Two studies examining the economic impact of allowing casinos in Cedar Rapids concluded that Iowa's commercial gaming industry has likely already reached its saturation point.

Last summer, the Iowa Racing and Gaming Commission (IRGC) ordered two market studies regarding a casino in the state's second most populous city. The Cedar Rapids City Council and Mayor Tiffany O'Donnell approved a state-issued gaming license to allow a group of local businessmen operating as the Cedar Rapids Development Group to finance a casino resort on 25 acres of city-owned land. Are demanding. Cedar River.

The IRGC hired Marquette Advisors of Minneapolis and Innovation Group of New Orleans. Consulting firms were tasked with estimating how much money the Cedar Rapids casino would make each year and how other casinos in the state might be affected.

The results were not in favor of a pitch called Cedar Crossing Casino.

disastrous conclusion

Marquette and Innovation respectively estimated that a casino in Cedar Rapids would generate gross gaming revenues (GGR) of approximately $118 million and $116.5 million in its first full year of operation.

Both studies cite concerns about commercial casinos opening in eastern Nebraska and Illinois, and a tribal resort in Wisconsin. The new gaming offering is expected to reduce the “capture” of gambling Iowans.

The capture by Iowa commercial casinos of the defined gravity model revenue is projected to decline by 59% once Nebraska is fully developed, combined with the full impact of Permanent Hard Rock Rockford and the opening of Ho-Chunk Beloit. Council Bluffs is projected to be most impacted, while the Rockford and Beloit developments are projected to impact the Northeast the most,” the Innovation Group wrote.

Before neighboring competition, it was estimated that Iowa's commercial casinos had captured 72% of the available demographic.

Marquette's numbers differed slightly but they agreed that Iowa's casino industry is mature and fairly saturated.

“With casinos scattered across the state, casino gaming is a well-established industry and most Iowans can reach one or more casinos within a relatively short drive. Thus, individual casino markets are relatively tight. A review of casino player statistics shows that 63% of Iowa's adjusted gross revenues come from customers visiting within a 45-minute drive,” Marquette reported.

Most affected along the river

Both studies found that a gaming property in Cedar Rapids would cause the most harm to the Riverside Casino and Golf Resort. Marquette estimated the Riverside GGR would decline by about 30%. Innovation doesn't think it will be that severe, but still estimates a 12% loss for Riverside.

The IRGC is expected to vote at its Feb. 6 meeting on whether to expand the state gaming industry with a 20th casino.