Churchill Downs Opens Derby City Gaming in Downtown Louisville

Posted on: December 7, 2023, 12:28h. 

Last updated on: December 9, 2023, 07:53h.

Devin O'Connor @CasinoorgDevinO Read More

Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Churchill Downs Incorporated this week opened its newest historical horse racing (HHR) gaming venue in its home state of Kentucky with Derby City Gaming Downtown in Louisville.

Located at 140 S. 4th St. in Louisville, Derby City Gaming Downtown results from a $90 million investment that Churchill announced in October 2021. The 43,000-square-foot property features 500 HHR machines, a race and sportsbook, three restaurants, and a Kentucky Derby gift shop. Indoor smoking is prohibited, but the venue offers an outdoor smoking patio with a smattering of HHR terminals.

Along with the two Derby City Gaming locations in Louisville, Churchill Downs offers HHR gaming at its other four racetracks in Kentucky, including Ellis Park in Henderson, Newport, Oak Grove, and Turfway Park in Florence.

Louisville Comeback

Churchill Downs Inc. CEO Bill Carstanjen says investing in Louisville is critical as the downtown area tries to recover from the COVID-19 pandemic. Kentucky’s largest city remains battered by the coronavirus, with many storefronts and office buildings remaining vacant.

The goal was really to contribute to our community in an area where we thought our community really needed help, which was downtown Louisville,” Carstanjen said. “We wanted to find an opportunity to invest in our downtown because we’ve seen how it’s changed through COVID and over the last few years. We need to make Louisville a special place.”

A recent study from the University of Toronto’s School of Cities analyzed 66 major cities in the US and Canada to determine whether foot traffic remains below 2019 levels. Researchers utilized mobile data to determine that Louisville ranked second to last among the 66 locations, with only St. Louis ranking lower. Louisville is only seeing a little more than half (54%) of the pedestrians it experienced before the pandemic.

What Are HHR Machines?

Casino gambling remains prohibited in Kentucky, but HHR devices have been around the Bluegrass State since 2010. After a state Supreme Court decision questioned the legality of the machines in 2020, lawmakers formally legalized the gaming devices in 2021.

HHR machines look and sound like casino slot machines but differ because their calculations are based on previously run horse races.

Lawmakers thought that since the electronic games are pari-mutuel, they were legal under the state’s longstanding horse racing industry. But, the Kentucky Supreme Court in September 2020 unanimously ruled that HHR machines constituted illegal gambling.

Since HHR revenue financially supports the horsemen, an industry that sustains nearly 34K direct jobs and $115 million in annual tax revenue, Kentucky lawmakers quickly passed legislation solidifying the legal framework for HHR operations.

Churchill HHR Leader

Along with its HHR operations in its home state of Kentucky, Churchill Downs is betting big on HHR in Virginia despite the state opening commercial casinos with Las Vegas-style slot machines.

Churchill acquired Peninsula Pacific Entertainment (P2E) for $2.5 billion. The acquisition included P2E’s HHR business in Virginia, operating under the Rosie’s Gaming Emporium brand.

Churchill operates seven of Rosie’s HHR gaming parlors today. Churchill is also building a $372 million HHR resort called The Rose in Dumfries in Prince William County, 30 miles south of the nation’s capital.