Penn National has filed an application with the Pennsylvania Gaming Control Board for the development of its second satellite casino in Pennsylvania. In doing so, the gaming company has formally inaugurated the site for Hollywood Casino Morgantown.
The casino will reside on a 36-acre lot in Caenarvon Township in Berks County. The site is near intersections for Interstate 76 (the Pennsylvania Turnpike), Interstate 176, and Route 10 (the Morgantown Expressway)
The facility will encompass roughly 80,000 square feet of gaming space. Within that area, Penn National will place 750 slot machines and 30 table games. The space will allow for the placement of 10 more tables if demand requires them.
“While we explored numerous locations for our Category 4 casino in and around Berks County, the site we selected is unparalleled in terms of ease of access to three major arteries,” said CEO Timothy J. Wilmott, in a press release. “Hollywood Casino Morgantown is ideally situated to generate new revenues from the more densely populated suburbs to the west of Philadelphia, while further protecting our existing market share at Hollywood Casino at Penn National Race Course.”
Hollywood Casino Morgantown will also feature a sports-and-racebook. There will be a fine dining restaurant, food court, and lounge venue.
The completed casino should launch sometime in the first half of 2020. Penn National expects the operation to generate 250 permanent jobs and an additional 275 jobs to complete the construction.
What the heck is a satellite casino?
All this talk of a new satellite casino in Pennsylvania may generate one question: what is a satellite casino? Quite simply, a satellite casino is a smaller casino property that must be located so that it won’t interfere with one of the larger casinos.
Pennsylvania has 12 casinos already scattered across the state. Last year, the Pennsylvania legislature decided to expand gambling in the Keystone State even further.
It created provisions for, among other things, online casinos and sports betting in-state. The new law also authorized the creation of up to ten Category 4 casinos — the so-called satellite casinos or “mini-casinos.”
These casino licenses are limited by both scope and location. By law, they can house between 300 and 750 slot machines. They can also host up to 30 table games.
However, the law also allowed for limitations on possible locations on these types of casinos.
First, no satellite casino could exist within a 25-mile radius or “buffer zone” of one of the twelve casinos. Second, each municipality in the state could vote to opt-out of becoming the site of a Category 4 casino.
As a result, the options for placing a satellite casino are limited. Those options are further restricted by each company’s perception of demand for the municipalities that remained open.
Who has PA satellite casinos?
The PGCB awarded each license based upon the results of an auction process. Initially, only Category 1 and 2 licensees could compete, although the Category 3 casinos became eligible in the last two auctions.
Still, even though the law allowed for ten Category 4 licenses, the PGCB only awarded five of them. Given the waning interest and fee collected at each subsequent auction, it is unlikely that any more will come up soon.
Penn National is the only company to receive two Category 4 licenses. The company successfully bid for the first license by overpaying for it, volunteering over $50 million for the opportunity. However, this license only cost the company $3 above the base price of $7.5 million.
Penn National may have had a motive beyond the opportunity to run these casinos in mind. Their locations will serve as protection for the company’s main property at Penn National Race Course.
Penn National is also the owner of Hollywood Casino Charles Town. In August 2018, Hollywood Casino Charles Town became the first location in West Virginia to offer sports betting.
