Las Vegas Sands Wins Fourth Pennsylvania Satellite Casino Auction, Selects Location Near Ohio Border

Posted on: February 21, 2018, 02:00h. 

Last updated on: February 21, 2018, 12:16h.

Casino.org Staff Writer Read More
Expertise: Commercial Gaming.

Las Vegas Sands could soon have as many gaming floors in Pennsylvania as it does in Nevada.

Las Vegas Sands Pennsylvania satellite
From Sin City to Macau, to Mercer County, Pennsylvania? Las Vegas Sands’ newest casino bet is on a small town in the western part of the Keystone State. (Image: Wikipedia Commons)

The parent company to The Venetian and Palazzo won the fourth of 10 satellite casino auctions in Pennsylvania on Wednesday, with the winning bid totaling $9.9 million.

Sands selected a 15-mile radius in Mercer County, which sits in the northwestern part of the state near the Pennsylvania-Ohio border.

Pennsylvania’s 10 Category 1 and 2 license holders are eligible to bid on the Category 4 satellite casinos. The venues were authorized in a massive gaming expansion measure signed into law by Governor Tom Wolf (D) last fall. Each satellite is permitted to house up to 750 slot machines, and 30 table games.

Las Vegas Sands owns Sands Bethlehem in Eastern Pennsylvania. The casino is the second largest revenue generator behind Parx near Philadelphia.

Sands has two business days to pay the full $9.9 million to the Pennsylvania Gaming Control board (PGCB). It then has six months to submit plans for the precise location of the satellite casino.

Bidding Slows

In an effort to help bridge a $2.2 billion budget gap, and a Republican-controlled General Assembly apprehensive to raise taxes, the Pennsylvania legislature signed off on a gambling package that authorizes 10 satellite casinos, online gambling, airport and truck stop gaming terminals, daily fantasy sports, and more.

The gambling measure assumed $100 million in new revenue from the issuance of the satellite permits. But higher than expected initial bids easily eclipsed that figure, with the state collecting $111.4 million during the first three auctions.

Hollywood Casino owner Penn National won the first auction with a $50.1 million offer to reserve York County. Parx Casino took the second round with a $40.1 million bid to secure Westmoreland County. Mount Airy was next with a $21.1 million payment for Lawrence County.

But the bidding war has apparently eased, as the $9.9 million submission from Las Vegas Sands is $40.2 million less than what Penn National anted. During Wednesday’s auction, the PGCB took only two sealed bids, meaning five qualified casino operators chose not to submit an offer.

Location in Question

Las Vegas Sands selecting its 15-mile radius in Mercer County’s Hempfield Township is a bit perplexing, as seemingly more attractive towns remain in the running. Mercer County as a whole is home to just 116,000 people. On the Hempfield Township local government website, “entertainment attractions” include a golf course, VFW, and bowling alley.

Local government officials in Reading, a city in northeast Pennsylvania with roughly 90,000 residents, and over 415,000 in Berks County, is chomping at the bit for a satellite casino.

The city is also about 40 miles from Sands Bethlehem, a region that Las Vegas Sands would presumably like to secure when it comes to maintaining its regional customer base.

Penn National rationalized its $50.1 million bid for York County as “an investment we felt like we had to make to protect a major market area for our casino.” York is 30 miles south of Penn National’s Hollywood Casino.

However, the 15-mile satellite zone centered in Hempfield does lend Sands to build its casino fairly close to Interstate 80, a major artery that travels from New Jersey to San Francisco.