Penn National Completes U-Turn With This Week’s Opening Of York Mini-Casino

Company once thought mini-casinos should be struck down in court, and now it's ready to open two
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Three years ago, Penn National Gaming filed a federal lawsuit trying to block Pennsylvania from creating the mini-casinos that were authorized in 2017 gaming expansion legislation. How times have changed: Three days from now, PNG will open its first mini-casino — one in York County that it anticipates will complement rather than cannibalize its larger Hollywood Casino at Penn National Race Course 40 miles to the north.

A lot has changed about Penn National’s position on mini-casinos since 2018, starting with two successful bids at Pennsylvania Gaming Control Board auctions early that year for the Category 4 venues, as they are officially known. The company subsequently withdrew its suit against the state, saying it had decided to focus on development of the two projects in York and Berks counties rather than fight a law it initially proclaimed would harm its main casino.

The result is the opening, planned for noon Thursday, of Hollywood Casino York, a $120 million investment at York Galleria Mall that includes the $50.1 million for PNG’s winning auction bid. The rest of the money has been spent to renovate former Sears space on the first floor of the mall and fill it with slot machines, table games, dining outlets, and a sportsbook/OTB parlor.

This week, residents of York and surrounding counties may opt for a shorter drive than ever to play casino games. The 15th casino in Pennsylvania — and the second mini-casino after the Live! Pittsburgh property opened last November in Westmoreland County — may not have all the glitz of a Las Vegas venue, but it will present a convenient chance to gamble on the outcome of a slots spin, blackjack card, ballgame’s outcome, and more.

“We’re very optimistic we’re bringing the right product to the market and that we’ll be very successful,” Erin Chamberlin, senior vice president of Penn National’s Northeast operations, told Penn Bets in an interview last week.

No longer a defensive approach

Chamberlin was working for a competitor instead of Penn National when the state law containing mini-casinos was enacted and the company began reacting to it, but she said its approach has clearly evolved to a more positive outlook.

The original posture after winning the January 2018 bid was a “defensive” one, she said.

“It was to put up a casino in York and make it relatively small and use it more as a way to defend our turf at Penn National Race Course in Grantville,” Chamberlin explained. “But then we really started to look at it as an opportunity by looking at the York area and the growth it’s experienced — we really think there’s an opportunity for us to grow this market.”

She said the big regional gaming operator looks at the mini-casinos now as a “hub-and-spoke” model, where Hollywood Casino York and the Hollywood Casino Morgantown property planned for December opening in Berks County can themselves draw customers but also act as feeders for the main Hollywood Casino, not far away in Grantville.

Those venues are all much closer to one another than is the case with the Live! Pittsburgh mini-casino, which is some 280 miles from the Live! Philadelphia property to which it is attached on paper.

The population of south-central Pennsylvania has been growing more than is the case elsewhere in the state, which should be an advantage for Hollywood Casino York. Live! Pittsburgh is on track to bring in about $100 million in annual gaming revenue this year for The Cordish Companies. Chamberlin has been there and praised that property, but she declined to offer any public prediction on what revenue will be like in York County.

“There’s a great amount of business that comes from there to our Penn National Race Course in Grantville,” she said. “We know there are definitely players in that market, and we see an opportunity to grab those folks and ones from Maryland as well.”

Slot machines will fall shy of number allowed

To draw those customers, Hollywood Casino York will initially provide 510 slot machines, 24 table games, a Barstool-branded sportsbook and OTB race book, a Diner & Drinks sit-down restaurant, and a Classic Grill grab-and-go eatery. A staff of 290 has been hired to serve customers utilizing all those.

Chamberlin said details are being worked out to quickly get the table games up to the 30 allowed, but the number of slot machines will not come close to the 750 permitted, let alone the 1,927 in Grantville. That was one handicap from retrofitting the department store space rather than building from scratch, as is being done at the Morgantown site.

“We wanted to make sure the experience felt very open, very inviting, very comfortable for our players. So given the small size of the footprint, we didn’t think putting in the full allotment of slot machines would make it the most comfortable gaming experience right now,” Chamberlin said.

The limited space is also a factor, she explained, in restricting the smoking area to 15% of the gaming floor to assure non-smokers’ comfort. That’s a much smaller percentage than is typical in Pennsylvania casinos, which can allow smoking on up to half the floor.

On the other hand, by leasing space in the mall — technically located in Springettsbury Township, outside the city of York — the casino has ample parking and a prominent location along a busy stretch of U.S. Route 30 near Interstate 83. The York Galleria itself is nowhere near the customer draw it once was, considering the decline of brick and mortar retail, but Chamberlin said there’s a strong sense that the casino will benefit the stores still located there.

“The team here has a sense of pride in bringing back to life something that was a vibrant economic engine for the community and re-establishing it that way,” she said.

Also, vacant space remains above the casino on what served as the second floor of the former Sears store. It is possible Penn National could ultimately lease that area as well if it deems it beneficial to enlarge the casino, although Chamberlin said there is nothing the company is prepared to announce about that at this point.

Barstool Sportsbook and cashless gaming are new

Penn National has gradually been providing its casinos in legalized sports betting states around the country with Barstool-branded sportsbooks, making use of its part-ownership of the Boston-based sports media company of that name. Penn National’s online/mobile sportsbook also bears the Barstool brand, and its two Pennsylvania mini-casinos will each have Barstool Sportsbooks where patrons can drink, place bets, and watch games on a wide array of TVs.

Among young men in their 20s and 30s, Barstool’s irreverent, attention-getting social media personalities, from founder Dave Portnoy on down, have a huge following.

“Some people will come in because there’s a sportsbook, and another group will come in because it’s a Barstool Sportsbook and they’re Barstool fans,” Chamberlin said. “You not only get the sportsbook people, you get the Barstool people.”

One other aspect at the new casino is its cashless technology, which Penn National first offered recently this summer at the Grantville main casino and at the company’s Meadows Racetrack & Casino. It gives customers with smartphones a chance to avoid carrying around large amounts of cash, using ATMs, transferring slots tickets from one machine to another, or transporting their chips from a table game to a cashier’s cage. The system enables customers to download the company’s MyChoice app, transfer money from their bank cards or accounts into a digital wallet, and then scan the phone at slot machines and table games to transfer gambling funds in and out.

Chamberlin said an area will be set aside in the casino for team members to educate patrons who need assistance figuring out how to utilize the cashless technology, although all gambling can also continue to be done through traditional cash means.

“This is to help people enjoy the convenience of moving from slot to slot with no ticket printed out,” she said. “Everything moves very seamlessly with your phone. We found that COVID brought some silver linings … by accelerating a lot of new technology adoption from folks. This is just another way we’re bringing something totally different and new to York, and we’re very optimistic about it.”

Photo: Courtesy of Penn National Gaming

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