'Cabin fever' leads to big reopening weekend for South Dakota casinos

Key Points
  • Casinos in Deadwood, South Dakota reopened for business over the weekend after being closed to help contain the spread of the coronavirus.
  • Liv Hospitality CEO Caleb Arceneaux said he expects pent-up demand was the reason for above-average business.
  • Nevada restaurants were allowed to open Saturday with limited capacity but casinos remain closed. 
  • Betting and gaming company William Hill US got special permission to operate a drive-thru ahead of the Ultimate Fighting Championship fights in Jacksonville, Florida. 

In this article

Here are precautions one casino has taken for reopening
Here are precautions one casino has taken for reopening

For weeks, the burning question facing casino operators nationwide has been: "If you open, will they come?"

If Deadwood, South Dakota is any indication, the answer is yes.

This weekend 11 casinos in the historic destination town, which was the last in the nation to close its commercial gaming establishments, became the first to reopen.

"We were about 15% or 20% higher than a typical weekend business, which is significant," said Caleb Arceneaux, CEO of Liv Hospitality, part of a family business that owns and operates Tin Lizzie Gaming Resort and Cadillac Jack's Gaming Resort and four hotels in Deadwood.

"Cabin fever's real, and I think people wanted to get out and experience, you know, gaming again," Arceneaux said, adding that weekend occupancy was running 85% to 90%, with many driving in from surrounding states.

Players enjoy a game of craps on the first weekend 11 casinos reopened in Deadwood, South Dakota after being shut down during the COVID-19 crisis.
Source: Liv Hospitality

That's important as casino operators nationwide balance the cost of reopening with the ramp, or lack thereof, in business. 

Penn National Gaming owns 41 facilities in 19 states. CEO Jay Snowden said he's watching demand closely at tribal casinos that opened first. 

"Between 25% and 30% of prior year revenue levels will get us to break even," Snowden said.

In Montana, Golden Entertainment operates 3,000 slot machines, which were turned on for play May 4. The company said it saw pent-up demand and customer volumes comparable to preclosure levels as patrons returned to their local taverns.

In Nevada, restaurants were allowed to reopen starting Saturday with capacity limits set at 50%, but casinos are still closed.

Betting and gaming company William Hill US got special permission from the Nevada Gaming Control Board to operate a drive-thru at several locations in Las Vegas so customers could set up mobile sports betting accounts or deposit money into an existing account.

"It was very well received," Joe Asher, CEO of William Hill US, said. "Customers were really patient and waiting in line in their cars." 

The timing was important. It allowed the sportsbook operator to take advantage of the first sporting event since the coronavirus pandemic shut down professional sports. The Ultimate Fighting Championship hosted fights in Jacksonville, Florida, that aired on pay-per-view.

"This was all done around the UFC card from this weekend, which was, by far, the biggest bet UFC card ever," Asher said.

William Hill plans to run the drive-thrus again, ahead of next weekend's return for Nascar at the Darlington Raceway in South Carolina.

Asher said the shutdown of physical sportsbooks, the absence of fans at live events, is accelerating the move to mobile betting. And when retail locations reopen, the key to success will be making safety the first priority, he said. 

"Consumers want to feel safe when they go into a casino, and they're going to be sensitive to the safety protocols in place," Asher said.

In Deadwood, South Dakota, social distancing rules that call for 6 feet of separation are in effect in bars, restaurants and on gaming floors.  

Workers record bets ahead of the Saturday's UFC fight at one of four William Hill US drive-thru sports betting locations in Nevada.
Source: William Hill US

Though masks are not generally required, dealers for blackjack and other table games must wear masks, as they cannot maintain the 6-foot distance. And at the tables, only two chairs are available. Two slot machines are shut down between players and cleaning crews place stickers on machines that have been freshly sanitized. Craps and poker are limited to four players. 

On Thursday when the doors reopened, Arceneaux said he saw some nervousness and discomfort as customers tried to maintain social distancing. But then, as people pulled up to the slots or cozied up to the craps table at Cadillac Jack's, they relaxed and smiled, even though some of those smiles were hidden beneath face masks.

"I think as we get back to whatever the 'new normal' is going to look like, the people are going to be more comfortable coming out, and get over the fear and panic," Arceneaux said.

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