Five bids, five sites, one licence. Late last month, Leeds city council announced the bids received for its large casino licence (see below). Cue the feathered dancing girls and flashing lights – well, hardly.
The announcement was met with barely a whimper. The operators clearly decided not to make a song and dance about finally being able to go public with their bids. Las Vegas-style celebrating this was not.
Local agents believe regeneration benefits will be minimal, and capital receipts scant. In fact, some now think that the casino industry is going through what Roy Ramm, executive director at London Clubs, describes as “very tough” times (see below).
The idea of operating a Las Vegas-style gaming hall might have lost its shine. So when it is time to put down their money, will anyone be betting for the licence?
“I’m not sure that many operators are wildly excited,” says Alex Munro, partner at Knight Frank, adding: “I don’t think there is a great huge pot of gold regional casinos are not the easiest sell.”
In fact, Munro is not too enamoured with the super casino licences, full stop. “The point was that we were all going to have big regional casinos, then everyone chickened out because of the Daily Mail. Does anyone care anymore?” he asks.
Leeds city council states that as the granting of a casino licence is a statutory process it will make no comment on any of the applications. It adds that it has no preferred location or applicant.
Conservative attitude
But the industry has done its own analysis. Look at the sites, and most reckon several can be easily discounted. Eastgate is too far into the future to be a viable option and Hammerson’s conservative attitude to development at its Eastgate scheme will only exacerbate this. Rank Group’s on-off and on again takeover of Gala Casino finally became official this month and might put its own bid in question. Rank Group (which owns the Grosvenor brand) already owns Grosvenor casino on Merrion Way and this acquisition adds Gala’s Wellington Bridge club. Would they want a third?
Some property players believe that Rank could close both and open a big new club on Quarry Hill. Rank declined to comment, saying in a statement: “We can confirm that we are preparing an application for the large casino licence in Leeds.”
Munro believes only one has a chance of making it through and that is the existing Alea casino at Clarence Dock. The casino, owned by London Clubs, sits right next to the area’s struggling shopping development. Allied London bought Lend Lease’s stake in the scheme back in January, giving it overall control. One agent says: “I would have thought Allied London would do anything to get more people down there.”
A casino might do just that but an existing facility would hardly give Leeds council the development boost it wants, nor would it bring any money into the coffers. Ramm is quick to defend this. “I kind of think we’ve done the regeneration bit,” he says, adding: “Other people might promise, but we’ve already delivered it. We’ve pumped millions into Leeds and that is not the superstructure but our fit-out.”
London Clubs built the Alea casino with expansion in mind. The extra machines covered by the large casino licence could all be accommodated within the existing club. Ramm says London Clubs is now working with Allied London and together they are developing a new vision for the area. “We’ve got a real opportunity to give some sparkle and life into Clarence Dock,” he says.
“The extra gaming facilities would bring people into the area and we’d deliver a wide selection of slot machines – the largest in the region – and give a real lift to the businesses.”
Alea could do this in a matter of a few weeks. Ramm says: “One of the issues the local authority is required to consider is the deliverability – we have delivered.” And if it didn’t win? “We’d be very disappointed,” he says simply.
Hot on his heels is Rushbond. Plans are underway to transform the former Majestic nightclub on City Square into a 35,000 sq ft casino. Richard Baker at Rushbond says he is “100%” committed to the application. “We are running it as a developer without an operator and we have an existing building, which is in the latter stages of refurbishment. It’s undisputed in terms of prominence and the previous owners had a joint venture with a casino operator and secured planning consent for it to be used as a casino.”
Now, the bidders will have to advertise their applications, and stage one applications will be considered in July. Stage two applications will follow. Clearly, some of the players are very still excited about the licence – maybe the dancing girls could go on hold.
The casino market
Times are “very tough” in the casino industry, says Roy Ramm, executive director at London Clubs. Casinos have been battered by online providers that often do not have to adhere to the same stringent regulations as home players and the industry often bears the brunt of public criticism that they are sleazy, dark clubs filled with ne’er-do-wells.
However, Ramm points to a few hard-hitting figures. There are 146 casinos operating in the UK, running 2,400 slot machines. By contrast, there are 10,000 betting shops with 35,000 slot machines.
Online, a slot machine can play at up to £250 a spin, whereas in Mayfair, London Clubs runs casinos for high-rollers, where the slot machines can operate at only £2 a spin.
“We’re saying that clearly there is a market, so let’s make sure that people get the opportunity to play in the safest environments.” Ramm points to the government minister who went on oath in parliament to say he thought casinos were the safest places to gamble.
The five choices
Applicant Location
• Global Gaming Ventures Eastgate Quarters
• Grosvenor Casino G Casino, Quarry Hill
• Leeds United Football Club West Stand Concourse, Elland Road
• London Clubs Leeds Alea casino, Clarence Dock
• Rushbond Majestic, City Square
