The two new casinos that have succeeded Las Vegas Sands’ abandoned EuroVegas project in Madrid say they’re holding their own despite the country’s challenging economic climate.
Casino Gran Madrid, owned by Grupo Gran Madrid, and Casino Gran Via, owned by Grupo Comar, opened their doors just days after LVS announced in December that it would not pursue the $30 billion EuroVegas without a number of labor and financial and tax concessions and an exemption from a tough national anti-smoking law which the Spanish government refused to grant.
“The arrival of a giant like EuroVegas meant that we had to do something and couldn’t just stand still,” said Pedro Olmedo Franco, a director of Casino Gran Madrid. Without it, he said, “We probably wouldn’t be here now.”
Unlike some other Spanish cities, Madrid had a longstanding ban on any casino operating within an 18-mile radius of the city center. But it was effectively lifted when the city found itself competing against Barcelona to lure EuroVegas. Grupo Gran Madrid already had three casinos in Spain with combined revenues of €28 million. Grupo Comar has several casinos in Spain and the Dominican Republic which generated €110 million last year. The former spent €20 million to open Gran Madrid, the latter €15 million for Gran Via.
Neither operator said it could provide earnings details so close to their openings. Franco characterized Gran Madrid’s debut as “slightly weak” because of the Christmas season, while Javier García, general director of Grupo Comar, said he was “very satisfied” with Gran Vía and predicts it will turn a profit this year. The casino has recently averaged 1,500 visitors a day, each paying an entrance fee of €9 and required to bet a minimum of €2.5. forecast a profit for this year, without providing specifics.
The global downturn plunged Spain into a banking crisis that required a massive international bailout. The economy emerged from a two-year recession in the third quarter of last year but still faces serious challenged, including a 26 percent unemployment rate. The two casinos have made a modest contribution on that front. Gran Vía created 270 new jobs, Gran Madrid 200 jobs in addition to relocating 250 existing staff members to the capital city.
Miguel Córdoba Bueno, a professor of applied mathematics who published a book last year about gambling, said Sands’ choice of Madrid shows that it is “by some margin the most attractive city to set up a casino.”
The two casinos, meanwhile, have been targeting foreign tourists, placing advertisements in the city’s main hotels. Last year, Spain hosted 60.6 million visitors, a record for the country, but Madrid’s share fell about 5 percent to 4.2 million.
