LASER: Developing Highly Targeted and Focused Development Approach
By Andrew MacDonald and Bill Eadington
When assessing possible venues for casino developments what are the characteristics that might be considered in order to facilitate the development of successful gaming properties?
Free or quasi-free market gaming environments often throw up a range of potential sites for gaming developments. The process of determining which sites might offer the best prospects will often be left to the casino developer. In other instances where markets are constrained the same situation may apply or the local government authority may itself attempt to determine the most suitable location for the venue. While the objectives of government may not always be aligned with those of commercial operators many of the considerations will be similar or should be equally understood.
A quite useful acronym for considering different sites or venues for gaming developments is LASER. LASER stands for location, access, scale, entertainment and range of offering. The most desirable characteristics for a site or venue are those with a great location with a dense population surrounding the site and a site that is highly visible and easily accessible. The site should provide the spatial characteristics most suited to the development and preferably provide expansion opportunities for future growth. It is also preferable for the site to be located in an existing leisure or entertainment precinct within the region and complement the range of facilities already on offer. A more definitive evaluation matrix may be established based on a rigorous assessment of each of the criteria.
Location. What is the population base and demographics of the area? How dense is the population? How culturally diverse is the population? Is there a specific ethnic or religious mix in the area? Is there considered to be high demand for a gaming facility? Is the location considered "safe" by locals or those within the region? What are the planning and zoning requirements of the site? What competition (direct and indirect) exists within the area? Will the location support additional facilities? What is the proximity to other tourist attractions? What is the proximity to hotel concentrations? What are the aesthetics of the area?
Access. How visible is the potential venue? How easily accessed is the venue by public transport? What are the travel times to the potential venue? Is there a marked difference between peak and off-peak travel times? Does the road system provide easy access to the venue from different directions? Is parking at or near the venue an issue? Will the local authorities provide the level of parking with the venue that is suitable to the proposed scale of the development? How near is the local airport? What accommodation facilities already exist around the potential venue? Is the area safe to walk around? Will the local road infrastructure be sufficient considering the volume of traffic the proposed facility will generate?
Scale. What development footprint exists? Is the size of the venue suitable for current and possibly future demand forecasts? Is the development planned to be mixed use? Does the development footprint support a single level gaming floor? Is the scale of the proposal appropriate relative to the current competitive environment? Is there an opportunity to create a sense of arrival at the venue? What planning restrictions exist that might restrict the development?
Entertainment. Is this development part of a greater leisure and entertainment precinct for the location? Is the area already known as an entertainment "hub"? What other leisure facilities exist within the location? Is there a need for an expanded offering within the location generally? What type of leisure and entertainment facilities might best be clustered and offered to act as a magnet to the proposed development? Is there a need for the development to include nightclubs, cinemas, showrooms, theatres, bars and restaurants to stimulate activity and traffic?
Range. Is there a clustering of offerings and activities which will be conducive to attracting a wide cross section of the public? Is there an existing convention and exhibition facility at or near the proposed venue? Are there a broad range of retail facilities near or associated with the venue? Is the entertainment and retail offering that exists extensive or limited? Is there a strategic or competitive need to offer a broad range of options to the public?
This type of analysis may also be useful in prioritizing development opportunities within a region. A simple but practical example would be to consider the two opportunities proposed by the Singapore government. Singapore has proposed the development of two Integrated Resorts (with casinos) and has attracted substantial interest with every major casino operator in the world responding to the Singaporean government's "Request For Concept" (RFC). The RFC provides for the possible development of two sites within the island state. The first is a development at Marina Bay and the second on Sentosa Island. Utilizing the LASER evaluation matrix it is possible to determine which of the two sites offers better potential from a casino operator's perspective. In the case of the Singapore government process it also indicates how the process might best be run, with the government determining that it would be in their best interest to run the "bid" process first for Marina Bay and then, following a period of approximately six months, run the second bid for Sentosa. Based on the initial responses to the RFC and the relative interest in both sites it seems that most operators prefer the Marina Bay site and that the government is seeking to maximize its own "return" by offering that site for consideration first. The primary weaknesses associated with the Sentosa site are its island location, single bridge access, lack of parking and development scale.
Governments will often overlay likely social, economic and regeneration impacts when considering such issues and consider their own strategic positioning relating to gaming and leisure developments within their jurisdiction, however, it is important that government, if it is to determine location, does so with the knowledge of the attributes that most suit developers. If a decision is ultimately made by government to offer a sub-optimal location for gaming development, then it is unlikely that it will maximize its possible economic rents from the development. For government the LASER acronym remains valid but may transform to location, accessibility, social impacts, economic impacts and regenerative potential.
Such considerations will almost certainly be put into play in the United Kingdom where an Independent Advisory Panel is to be charged with determining the most suitable locations for the development of the UK's first regional casino and the eight new large and eight new small casino licenses that are provided for under the UK's 2005 Gaming Act. Clearly this will be a difficult task given the complexity of the issues and the size of the UK. While popular sentiment seems to have favored Blackpool for the UK's first regional casino, it is questionable as to whether or not Blackpool would indeed measure up using a LASER evaluation framework. Other locations throughout the country, including Birmingham, Cardiff, Glasgow, Middleborough, Nottingham and certain boroughs of London as well as other areas, all have highly justifiable cases for regional casino developments. To determine the most appropriate location will require a highly targeted, measured and focused approach.
