It’s a new year, but the same old problems persist for the Horseshoe Baltimore casino.
Owned and operated by Caesars Entertainment, the property reported a gross gaming revenue (GGR) decline of 28.7 percent in January. Horseshoe Baltimore’s casino win totaled $13.75 million, a decrease of more than $5.5 million compared with January 2020.
The casino has been limited to operating at 25 percent of its fire code capacity since November. The city order remains in place.
Statewide GGR last month totaled $128.7 million. That represents a decrease of 11.5 percent from January 2020 when the state’s six casino floors kept $145.4 million of gamblers’ money.
Horseshoe Hurdles
Caesars’ casino in Maryland has been struggling for years. Envisioned as an entertainment destination that would benefit from its proximity to Camden Yards and M&T Bank Stadium, respectively the homes of the MLB Baltimore Orioles and NFL Baltimore Ravens, the short walk from the sport venues along Russell Street remains uninviting.
CBAC Gaming, LLC, the entity that was formed by Caesars to build the casino in 2013, invested $442 million to construct the property.
The company has spent many millions more buying distressed warehouses and buildings along Russell Street in hopes of working with other local businesses to bring new life to the area. Horseshoe also spent $15 million to build an outdoor gaming terrace where gamblers can smoke and play.
Despite its efforts, CBAC Gaming continues to be struggle. Moody’s Investors Service downgraded the company’s debt to Caa2 last March, a classification “judged to be of poor standing and are subject to very high credit risk.”
“The downgrade of CBAC’s Corporate Family Rating is in response to the disruption in casino visitation resulting from efforts to contain the spread of the coronavirus including recommendations from federal, state and local governments to avoid gatherings and avoid non-essential travel,” the downgrade statement explained. “These efforts include mandates to close casinos on a temporary basis. The downgrade also reflects the negative effect on consumer income and wealth stemming from job losses and asset price declines, which will diminish discretionary resources to spend at casinos once this crisis subsides.”
Caesars is the majority stakeholder in CBAC Gaming. The entity’s original investors also included what’s now known as Jack Entertainment, a gaming and hospitality firm privately held by Rocket Mortgage billionaire Dan Gilbert.
COVID-19 Hurting Casino Numbers
Horseshoe Baltimore certainly wasn’t alone in enduring a rough month to kick off 2021.
MGM National Harbor, the top GGR earner in Maryland, saw its casino win drop 13.7 percent to $50.5 million. Live! Casino & Hotel reported a loss of 7.7 percent, GGR at the Anne Arundel casino totaling $47.7 million.
Two of the state’s three smaller resort-style casinos fared better. Ocean Downs Casino saw a revenue increase of nearly six percent to $5.6 million. Hollywood Casino in Perryville won more than $6.8 million — an 11.8 percent gain.
Rocky Gap, the third resort-style property, experienced a decline of five percent. Casino win there totaled $4.2 million.
One bit of good news for Maryland’s gaming industry is that sports betting is soon on the way. Voters approved of the gambling expansion during the November election through a ballot referendum.
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