The new property owner and landlord of Tioga Downs Casino Resort is optimistic about the future of the Upstate New York racino.
The confidence expressed by Gaming & Leisure Properties, Inc. senior leadership during a recent investors’ call is understandable given the current state of legal gambling in the Empire State.
Land-based gambling facilities are trending upward (Resorts World NYC was the highest-grossing property outside Nevada in 2023), NY sports betting is exceeding expectations and the projections for online casinos in NY suggest another billion-dollar market vertical is likely to arrive within the next few years.
GLPI plants NY casino flag with Tioga Downs purchase
Executives with Gaming & Leisure, one of the two prominent real estate investment trusts in the gambling industry, said gaining a foothold in New York was an attractive proposition. The Pennsylvania-based REIT recently bought Tioga Downs for $175 million.
“We obviously have an interest in geographic diversification,” Steven Ladany, senior vice president and chief development officer of GLPI, told investors on the Q4 earnings call.
Gaming & Leisure now owns 62 properties across 19 states. Some of its more noteworthy casino properties include Tropicana Atlantic City, Tropicana Las Vegas, M Resort in Nevada and Live! Casino & Hotel Philadelphia.
Smart money says to bet on Gural, Tioga Downs
Tioga’s former owners, American Racing and Entertainment, are now tenants but will continue to operate the gaming operations. Ladany specifically mentioned GLPI’s relationship with Jeff Gural, the CEO and founder of American Racing & Entertainment, as another reason why Tioga fits into the company’s growing real estate portfolio.
“(Tioga Downs is) a wonderful asset, and I think we feel very comfortable that whether it’s Jeff or someone — someone will want to run that property long into the future beyond when I’m here even — we felt very good about the longevity of the asset and the counterparty we were dealing with,” Ladany said.
GLPI and American entered into a 30-year triple-net master lease agreement, according to a press release announcing the deal.
Gural, who also owns and operates the Meadowlands Racetrack in New Jersey, bought Tioga for $32 million in 2005. Tioga officially became a racino in 2006 when video lottery terminals were installed.
New York awarded Tioga a class III casino license in 2016, allowing it to offer Las Vegas/Atlantic City-style casino games with RNG (random number generator) slot machines and live dealer table games. Tioga Downs is one of four commercial casinos in New York, along with del Lago Resort and Casino, Rivers Casino & Resort and Resorts World Catskills.
Looking ahead at NY gambling market
New York is in the process of issuing three more commercial casino licenses in the downstate region, which includes New York City and Long Island.
Class III license holders would, presumably, be among the frontrunners for online casinos in NY if/when the State Legislature acts to legalize iGaming.
Of course, that licensing process has continued to take much longer than initially anticipated. As such, downstate casinos may not open until 2025 (if an existing racino earns one of the licenses) or even 2026 for the from-scratch projects.
All of that is to say, for the near future, upstate casinos such as Tioga Downs will continue to hold a monopoly of source on the land-based gambling industry in New York.