The fight over where people bet in the future

The fight over where people bet in the future

  • October 27, 2020
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A battle to be the place to watch and bet on sports is raging around the country, and the Las Vegas casino owner sitting on his corner barstool chuckling like Norm Peterson from “Cheers” is very much in the fight.

Whether drinking with guests at Longbar at The D hotel casino, or making big sports bets with competing bookmakers around town, Derek Stevens has emerged as the most approachable casino owner in Las Vegas since arriving from Detroit in the 1990s. Now everyone is watching his next move, as if the future of sports betting in Sin City depends on it.

The coronavirus pandemic crushed Las Vegas’ gaming and tourism industry back in the spring. The sportsbooks sat dormant for months, and revenue plummeted. According to the Nevada Gaming Control Board, gaming revenue in April suffered a 99.6% decrease compared with April 2019. Casinos are back open now, and crowds (of mostly locals) have returned to sportsbooks, which are operating at limited capacity during their most lucrative time of the year, football season. But the pandemic is just one of many challenges facing giant sportsbooks such as Caesars Palace, The Mirage and the SuperBook.

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The professional sports leagues themselves have entered the bookmaking business and are aiming to lure fans out of the casinos and into placing bets inside their own stadiums and arenas. The location of sportsbooks, however, has become somewhat irrelevant. As regulated sports betting spreads across the United States, most bettors have access to bookmakers in their pockets, on their phones. The bulk of sports betting now takes place online, so it’s understandable that casinos outside Nevada are more often opting to build sports bars rather than the giant amphitheater sportsbooks that are so popular in Las Vegas.

Not so fast, Stevens says. He is going in the other direction, a contrarian play. On Wednesday, Circa, Stevens’ new resort in downtown Las Vegas, opens with what’s being billed as the “world’s largest sportsbook.”

“There’s still an awful lot of demand for watching sports,” Stevens says. “As much as everyone loves being on their phones, there’s still an element where people like to get together and watch a game.”

‘The screen is just massive’

The seat with Stevens’ name on it at Longbar is just a few steps from the entrance onto Fremont Street Experience, a tourist hot spot that combines an old-school Las Vegas look with a Mardi Gras feel. It can get crazy, and Stevens has a front-row seat to it all. The man has seen a lot, but he wasn’t prepared for the first time he saw the towering odds board at his new sportsbook at Circa light up.

“I was with a pretty big group, and when they threw all the screens on, we all just jumped back because it was so bright,” Stevens says with a laugh.

Circa is the first ground-up resort built in downtown Las Vegas since 1980, standing 458 feet tall. When completed, it will have 44 floors, 777 rooms, a 5,000-square-foot multitiered swimming pool amphitheater and a nine-story transportation hub dubbed the “Garage Mahal.”

Construction began on Feb. 19, 2019, with a target of opening in December 2020. Like all projects started before the pandemic, Circa faced significant hurdles in 2020, including what Stevens calls some “uh-oh moments.”

“If you’re a batter at the plate, and you’re sitting fastball, and you get a curveball thrown your way, you’ve got to make an adjustment,” Stevens says.

At its peak, there were 1,200 construction workers on site daily, before COVID-19 safety protocols were put in place in March. That created new challenges; for example, only three workers were allowed to ride together in a construction elevator. A round trip to the top of the tower in the elevator took five minutes. They struggled to get enough workers to the top levels in an efficient manner and were running out of time. At one point there were fears that workers would have to be furloughed, with no guarantee that they’d come back.

At the advice of his team, Stevens audibled, electing to have his workforce focus on the first five floors of the casino. That decision allowed Circa to open eight weeks ahead of schedule.

“Great call by the guys,” Stevens says.

Stevens is tight-lipped about the cost, declining to offer even a hint about how much he has invested in Circa. He is direct about his new sportsbook, though — it’s the main attraction.

Three stories tall, the sportsbook at Circa was designed so that it could be seen from everywhere on the casino floor. It features a massive video wall with 78 million pixels that requires 10 people to operate.

“I’ve been part of these meetings, seen the renderings and been a part of the process,” says Matt Metcalf, Circa’s sportsbook director, “and I still don’t think I anticipated how cool it is. The screen is just massive.”

There’s stadium seating, and a broadcast studio. And with an occupancy of 1,000, Circa is certainly upping the ante in the Las Vegas sportsbook game. But is it the last of its kind?

“If we’re very successful, there’s going to be more that come up,” Stevens says. “If we’re not, then there probably won’t be. It kind of depends on how we do.”

Stadium sportsbooks: ‘How do we get in there?’

On a Sunday morning in September, three time zones away from Las Vegas, a line has formed outside the box office at Capital One Arena in Washington, D.C. People are waiting to place bets.

Since no live sporting events are taking place at the arena because of the pandemic, the box office has been converted into a William Hill U.S. sportsbook, with betting windows and self-serve kiosks. It is the first retail sportsbook ever to take bets at a major American sports venue. In September, an average of 3,800 bets per day, totaling $12.2 million, were placed at the sportsbook.

With a permanent space inside the arena expected to open in 2021, hopefully alongside the return of the Wizards, Capitals and Mystics, this is another reminder that competition is increasing for where people watch and bet on sports.

Circa

In May 2018, the Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992, the federal statute that had restricted regulated sports betting to primarily Nevada. The decision ended a six-year courtroom saga between the NCAA, NFL and other major professional sports leagues versus the state of New Jersey, and it altered the sports betting landscape in the U.S. Since the ruling, legal sportsbooks have begun operating in 18 states and the District of Columbia, which was the first jurisdiction to give sports venues the right to offer sports betting.

In January 2019, Monumental Sports, Ted Leonsis’ sports and entertainment ownership group, sent out a request for proposal regarding building a sportsbook inside Capital One Arena. The RFP landed on the desk of Dan Shapiro, vice president of strategy and growth for William Hill U.S. He took it to his boss, CEO Joe Asher, and asked for his thoughts.

“I wasn’t sure we should even respond to it,” Asher says, noting that competitor MGM has a casino in the D.C. area and that Leonsis had an established investment in DraftKings.

“We certainly thought it was a long shot,” Shapiro says. “But since this was unchartered territory, doing something at a professional sports venue, we wanted to take our best shot at it.”

It worked, and on Oct. 3, 2019, Leonsis and Asher sat side by side, announcing plans to build a physical sportsbook inside Capital One Arena.

“It just shows how times have changed, from litigating in court to putting a sportsbook in the arena,” Asher says.

Capital One Arena isn’t alone. The Chicago Cubs have announced plans to build a sportsbook at, or in the vicinity of, Wrigley Field with DraftKings, and more arenas are considering following suit.

Dwayne MacEwen, the principal and founder of DMAC Architecture, told ESPN in the spring that his firm was discussing stadium sports-betting spaces with multiple professional teams that were “ready to go when the world goes back to normal.”

MacEwen envisions sports-betting spaces eventually moving to the lower bowl of arenas, offering comfortable leather recliners and a private bar with a digital ticker featuring odds and scores scrolling across it.

“We want people walking in to stop, point and go, ‘What is that? How do we get in there?'” MacEwen said.

“I honestly think COVID-19 has accelerated where sportsbooks were going anyway,” he added. “They’re more about hospitality, entertainment spaces. They’re more accessible to everyone, not just the bookie.”

Back to the future

It’s mid-March in Las Vegas, and mostly dark and quiet inside the Westgate casino — an eerie scene, especially knowing how busy it should be during March Madness.

Lines typically form outside sportsbooks at 5 a.m., or even earlier, on the opening Thursday and Friday of the NCAA men’s basketball tournament. This year, though, it was canceled because of the pandemic.

Today there are only a few flashes of light and a random jingle from a slot machine as Jay Kornegay, a 30-year Las Vegas bookmaker, strolls to his office at the SuperBook without seeing a soul. The SuperBook’s dazzling 240-by-18-foot LED video screen, which had run 24 hours a day since it was installed in 2015, is off.

On March 18, a day before the first full day of the NCAA tournament, the Westgate closed its doors for the first time since opening on July 2, 1969, as the Las Vegas Hilton.

“It was to a point where we didn’t even have locks on doors,” Kornegay says. “We had to make modifications to all our entrances and basically chain them up.”

They’re still not allowed to be at full capacity, but the demand for sports betting remains strong. With Major League Baseball, the NBA and the NHL all returning in August, more than $475.1 million was bet with Nevada sportsbooks, a record high for the month.

The majority of that money, roughly 63%, was wagered via mobile apps, though. In New Jersey, which is now regularly surpassing Nevada’s sports betting monthly handle, more than 90% of bets are placed online. Going to the window and handing over cash to place bets is nearing vintage status, but there are still a few holdouts.

“Call me weird or old-fashioned, but I like to have the ticket in my hand,” says Michael Jester, a 27-year-old data science consultant who lives 20 minutes from Capital One Arena in D.C.

No doubt, sports betting isn’t going anywhere. However, there are questions about where it will take place, how many people will be there and whether we’ll see another “world’s largest sportsbook” built in Las Vegas.

“Absolutely,” Kornegay says, “because I think sports betting is going to become more popular than ever. I think it’s an underserved market. I believe the sports-betting space is going to grow to numbers that we’ve never seen before, and I would suspect that not only are we going to see one but I think there will probably be a couple more of them built over time.”

It’s been just eight months since the Chiefs beat the 49ers in Super Bowl LIV, but it feels like eight years ago. Kornegay thinks back to the standing-room only crowd he had for that game, right before the pandemic hit.

“I think it might take a little while before we get Super Bowl-like crowds again,” Kornegay says, “but I think they’re going to return eventually.”

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