In Nevada, poker rooms come and go.
However, there are always signs that a room might be on the bubble. Here is a guide for symptoms of a closing poker room in the Silver State.
Twenty-eight poker rooms have shut their doors in Nevada since 2012. In 2018, there have been five that have gone under in Las Vegas alone, including the room at Treasure Island on the Las Vegas Strip.
According to Steve Ruddock, two more bit the dust in October. Thankfully, these closures were one or two-table affairs that may never have been meant as permanent additions.
What is interesting about all these closures is that the rooms are still reporting revenues that eclipse pre-poker boom figures. Per-room revenue soared to an all-time high in 2017. Per-table revenue was third only to 2004 and 2005, which were the years at the height of the boom.
Therefore, it would seem to be a time of prosperity for Nevada rooms. So, what gives?
Predictor of failure No. 1: room size
One noticeable change since the boom has been an increase in the average size of poker rooms. Rooms have added more than two tables per room since 1992, and the average room in 2017 had roughly nine tables.
Of the 28 rooms to close down, all but two have fallen beneath that threshold. Only one closing room, the M Resort and its 14 rooms in August 2013, was well above the average.
Many of the other rooms fielded five or fewer tables. The average for the closures group was 5.46 tables per room.
Rooms that fall beneath the nine-table threshold are at risk. Right now, 33 of Nevada’s poker rooms fall into that category, including 10 in the Las Vegas area.
Predictor of failure No. 2: competition/lack of discernible niche
The good news is that the sheer size of the room is not the only determining factor for its existence. A room that might fail in Las Vegas could conceivably thrive in Laughlin, Reno, or other smaller towns.
Places with heavy concentrations of competition will weed out the smaller and less memorable rooms. The prospect of competing with poker rooms like those at Aria, Bellagio and Venetian are too much for the TIs and Luxors of the world.
By contrast, the nine-table room at Peppermill in Wendover is the largest in its market. The Wendover Nugget‘s eight tables and Cactus Pete’s six-spot room are comparable to the top of the local food chain.
Some rooms might have a unique marketing position, too. A room with a six-digit-high hand jackpot or an exceptionally generous comp system might be a mainstay of its casino space. There are also rooms with a historical tie (like Binion’s) that make them essential to the casino’s overall marketing scheme.
Predictor of failure No. 3: casino financial difficulty
The third predictor may seem painfully obvious. If a casino property is experiencing financial difficulties overall, the chance of a poker room closure escalates.
However, it’s a bit more complicated than that. In a way, a closing poker room can act as a proverbial canary in the coal mine for the casino’s general health.
It’s relatively common knowledge that a casino’s best revenue source is slot machines. Indeed, slot revenue in Nevada historically outstrips table games (including poker) by almost a 2-to-1 ratio.
So, a struggling casino may believe that increasing its number of slot machines will help float the property back into the black. Since poker is nowhere near as profitable, the room space for poker may become expendable.
In fact, of the 28 casinos that shut their poker rooms, five went on to close, rebrand or rename under new management entirely.
- Fitzgeralds became the D Las Vegas.
- O’Shea’s relocated and downsized inside Flamingo.
- Bill’s Gamblin’ Hall became the Cromwell Las Vegas.
- Riviera closed and demolished.
- Monte Carlo became Park MGM.
Now, there is a bit of chicken-or-egg potential for this predictor, to be sure. However, any casino known to be in dire financial straits is a prime candidate for poker room closure.
A poker room’s closure is never fun for anyone. People can either lose their jobs or lose an option for fun.
These predictors of trouble are not absolutes by any means, either. Several rooms have kept dealing long after the writing on the wall said otherwise.
However, players that find themselves in rooms with less than nine tables need to take a close look at things. If the room is not well-maintained, is boring or unpleasant, and is in a casino with issues, they may find a sign on the door soon.