Track operator SMI may roll the dice on casino development
Speedway Motorsports Inc. is looking into having casinos built on its properties, according to sources, in a move designed to better leverage its real estate and connect with the expanding gambling industry.
Track operators are increasingly focused on creating revenue streams by using their sprawling venues for other activities. SMI owns eight speedways throughout the country and it is uncertain how quickly the company could make a casino deal happen. SMI is looking to partner with one casino operator that would operate all the casinos. A source said SMI is considering multiple tracks, but it is unclear which ones would be targeted.
SMI declined to comment, but the corporation has historically been focused on adding amenities and options to its venues that could make them year-round destinations, and casinos would help further that goal.
SMI has facilities in several major markets around the U.S., including ones near Las Vegas, the Bay Area, Atlanta, Charlotte, Cincinnati and Dallas/Fort Worth.
The track operator is looking into which venues are in states that could issue additional casino licenses. Four of its tracks are in states that don’t allow casinos (Georgia, Kentucky, New Hampshire and Tennessee), while three other tracks (Charlotte, Sonoma and Dallas/Fort Worth) are in states that only allow tribal casinos. SMI views Charlotte Motor Speedway as its headquarters and has been evaluating ways to add new commercial developments there in recent years, making it a possible candidate to be involved if the legal issues get sorted.
The eighth is Nevada, but Las Vegas Motor Speedway is unlikely to be one of the tracks involved, according to the source, because that city is already saturated with casinos. Additionally, South Point Hotel & Casino is the title sponsor of one of LVMS’s annual Monster Energy NASCAR Cup Series races, so SMI would not want to be seen as going into business against one of its partners, according to the source.
SMI’s rival track operator, International Speedway Corp., already has a casino at one of its tracks: Kansas Speedway. Hollywood Casino, which is owned by Penn National Gaming, operates the venture and splits profits with ISC 50/50. The move has turned into one of ISC’s more successful ventures, as the casino delivered $19.1 million in net income in 2017 and $14.9 million in 2016 to ISC’s balance sheet, and did so with little overhead for the track operator since Hollywood Casino runs the venue.
ISC is open to doing similar arrangements at some of its other tracks, according to a person close to the company, although the time frame and the tracks under consideration is unclear.