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VOL. 123 | NO. 88 | Monday, May 5, 2008

Slow Economy Could Equal More Biz in Tunica

By Andy Meek

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CHA-CHING: Tunica casinos such as the Gold Strike are rolling out a bevy of new deals and packages, even as the economic downturn doesn't appear to have put a major dent in attendance and revenue. -- Photo Courtesy Of The Tunica Convention And Visitors Bureau

With an economic slump, painful increases at the gasoline pump and a housing slowdown all combining to make the average wallet lighter these days, the concept of disposable income might seem like a curious relic.

That is, it might seem that way to anyone not among the high rollers, business travelers and recreational gamblers still lining up at any of the nine gambling halls in Tunica County to tempt the oft-pursued Lady Luck.

Casino operators in the Tunica market, a half hour's drive south of Memphis, are in the process of beefing up their properties and are spreading out a buffet of deals and special packages to entice players and hotel guests.

Figures show the average gambler in Tunica is spending more than a year ago, and he's bringing the fruits of a larger average annual income along with him.

Unroll the welcome mat

Nearly every casino is hawking a bevy of special rates and discounts. At Hollywood Casino, RV owners can stay in the casino's 123-space RV park for $18 per night through May 31. The Horseshoe Casino's recently renovated hotel rooms include 380 square feet of space, a number of pool views and 42-inch plasma-screen TVs.

The soundtrack to this year's long, hot summer months for the North Mississippi county could be the whirrs of Tunica's slot machines. While the slump has taken a bite out of everything from retailers to restaurants, the Grand Casino Resort in Tunica, for example, is preparing to rebrand itself as Harrah's Tunica later this month.

The casino received a complete overhaul in preparation for the change, which included the addition of new state-of-the-art slots.

"Another thing that might work in Tunica's favor right now is there's a pretty large population base within a day's drive of it," said Dr. Jeff Wallace, a senior researcher for the Sparks Bureau of Business and Economic Research at the University of Memphis. "So in tight economic times, with high gas prices, there might be a lot of folks who might consider going to Tunica - and the Memphis area together - as opposed to an even bigger, more expensive trip as a vacation."

Close vacation

Gamblers and casino patrons from Tennessee already are doing that in droves. The number of Tennesseans who hopped over the state line in the fourth quarter of 2007 to visit the casinos in Mississippi's North River Region, which includes Tunica's nine properties plus the Isle of Capri in Lula, was almost twice the number of Mississippi visitors. From Oct. 1 through Dec. 31, about 1.16 million visitors to those casinos came from Tennessee, according to the most recent figures from the Mississippi Gaming Commission.

That represents just a slight drop from the 1.2 million Tennesseans who ventured to the Tunica area in Q4 2006.

From 2006 to 2007, Tunica's gaming revenue also dipped slightly, going from $46.6 million to $46.5 million, according to figures that soon will be released by the Tunica Convention and Visitors Bureau. In 2007, the average annual income of visitors to Tunica was $58,700 and they spent an average of $484 per trip.

That's a slight gain over the previous year's figures, when the average annual income of Tunica's visitors was $54,300 and they spent an average of $465 per trip.

Not everything's rosy

The economic downturn, meanwhile, is reflected in at least one area for the gaming halls, in that the North River Region casino properties saw a decline of a little more than $10 million in gross revenue between Q4 2006 and Q4 2007.

The properties also shaved their headcount during that time period, going from 11,404 employees in Tunica's casinos in Q4 2006 to 11,065 employees in Q4 2007.

Another possibly foreboding sign: Myriad Entertainment & Resorts Inc., a company trying to develop a sprawling entertainment and casino-based resort in Tunica, has hit a variety of snags in its development effort. In a recent regulatory filing, the company said its independent auditor has doubts about the company's ability to press onward, given its recurring financial losses and difficulty generating cash flow.

Nevertheless, the guests - and the incentives to lure them - keep coming to Tunica. The Gold Strike has a special $49 room offer good through May 29. One of the current promotions happening at The Fitz is guests who cash their paychecks at the casino will be entered into a "Paycheck for Life" drawing.

That promotion will give participants a chance to win $1,000 every week for the rest of their life.

The Gold Strike also is promoting a Rock 'n' Roll Rendezvous Package with prices that start between $170 and $200. The package includes a one-night stay plus a variety of Memphis-themed treats: two tickets to Graceland, two tickets to Sun Studio and a $50 food credit at Charlie Vergos' Rendezvous.

"Normally, I would expect to see visitation to the casinos decrease during hard economic times," Wallace said. "But this may be one of those things where, at least for the Tunica folks, they may benefit during the downturn in the sense that it's not one of those destinations you're going to drive two days to get to.

"But it would be one you might drive a day and a half to get to, and there's a lot of folks in the local area that would fit that category."

PROPERTY SALES 61 61 6,453
MORTGAGES 46 46 4,081
BUILDING PERMITS 113 113 15,474
BANKRUPTCIES 19 19 3,289