Are Las Vegas locals casinos destined to continue their success in 2025? If you’re wondering about the future of these off-Strip casinos, you’re not alone. Locals casinos offer a unique gaming experience and a strong sense of community that resonates with residents. However, as we look to the future, these operators will face a complex web of challenges and shifting trends. Here’s a closer look.
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2024 Review
2024 was a mixed bag for casino operators like Red Rock Resorts, Boyd Gaming, and Golden Entertainment. On one hand, the highly anticipated Durango Casino & Resort at Red Rock Resorts’ Red Rock opened in December 2023 to great fanfare. On the other hand, it cast a shadow over some of its competitors.
Casino analyst Carlo Santarelli of Deutsche Bank called 2024 “an interesting year” for these local-focused properties. Boyd Gaming’s shares increased in 2024, while Golden Entertainment and Red Rock Resorts both saw their shares decline. Santarelli attributed the declines to rising operating expenses and flat same-store sales.
The new casino at Durango certainly took share from Boyd and Golden, but also from Red Rock’s main property. It’s hard to ignore the new shiny object.
2025 View
Looking to 2025, Santarelli says revenue growth will be important for both Boyd and Red Rock. The Durango Casino will regain its top spot, with an estimated net revenue of $340 million in 2024. Expansion of the hotel and additional amenities could boost that number in 2025.
That’s a big assumption, however. Durango’s impact is likely limited to the Sunset Region, and properties like the Boulder Station on the Boulder Strip and the Railroad Pass in Henderson, and the community centers like the Gold Coast and Palms in North Las Vegas. The real challenge is the overall market, which has yet to show any signs of expansion.
Workforce Worries
In addition to revenue, the workforce is another concern. Employee totals at locals casinos typically tracked revenue growth until 2019. Since then, revenue has been on a rollercoaster ride, but the 5.1% annual growth rate since 2019 is still intact. The problem is, employee totals are no longer trending with revenue. Since 2019, employee growth has slowed to a 0.9% annual rate.
Why is that important? Gaming revenue is up 4.2% year over year, and that’s largely due to Durango. However, it’s a red flag when revenue is growing that much without more support from employees. More tables and higher limits are helping, but it’s not the same as having enough employees to operate at full capacity.
Investor Takeaways
If you’re a casino stock investor, it’s important to monitor how these operators manage costs, compete with each other, and address their workforce issues. Boyd Gaming seems best positioned, Red Rock Resorts is counting heavily on Durango, and Golden Entertainment could benefit from a reboot.
As a Las Vegas resident, the real question is how these changes could impact your favorite neighborhood casino in the year ahead.
Let’s wait and see how 2025 plays out for these casinos!
