By Melissa Benmark, WKAR News
http://stream.publicbroadcasting.net/production/mp3/wkar/local-wkar-1002584.mp3
EAST LANSING, MI – WKAR's Melissa Benmark speaks with MSU professor emeritus Donald Holecek, about his thoughts on the plans for a new casino in Lansing. He began a study of the Detroit casinos when they opened, and the results were different than some might have predicted.
DONALD HOLECEK: It actually surprised us, too. We expected to see an uptick in crime, because any time you generate more traffic, you tend to have an increase in crime. We didn't find it. Actually, we found a slight decrease in crime. We're not attributing that necessarily to the fact that the casinos went in. I think it was just a situation where crime in general softened up a little bit about the time the casinos opened up in Detroit.
MELISSA BENMARK: You began that study, it looks like in 1999.
HOLECEK: That's correct.
BENMARK: Do you know of any studies since then that have looked at how Detroit or any Michigan casinos have done during the recession? Because, you know, during that period of time when you started the study, things were economically significantly different than they are now.
HOLECEK: Yeah, I don't think anyone has specifically gone into the depth that we did. In fact, there was a bit of a slowdown when the economy slowed down, but it never turned negative that I recall. And, matter of fact, it's been up a percent or two the last few times I've looked at it. So, the casinos, I think pretty much, across Michigan, the tribal casinos as well, have been hit by the recession, but not terribly hard. It's a pretty resilient industry, it appears.
BENMARK: How good an idea is it to invest in something like a casino when in general people do have less disposable income.
HOLECEK: Well, it depends on whether the market that you're looking at is fully saturated or not. So, if it's an underserved market, the fact that the economy is soft, incomes are down a little bit, the demand should still be adequate to make it a profitable investment.
BENMARK: I was going to ask you about saturation. That, is there sort of a maximum number or sort of a sweet spot after which some of them or all of them don't thrive because there are just too many of them? Because I would say Lansing would be coming to this relatively late after the tribal casinos up north, and in Mount Pleasant, and the Detroit casinos, that kind of thing.
HOLECEK: There's only one way to answer that question officially. And that would be, to let the market decide. It has seemed in Michigan I've been asked this question probably at least the last ten years isn't the market saturated? And I keep saying, well, I'm not sure. We keep adding casinos, and none of them seem to be going under. So, I think we're not at the saturation point yet, and we won't know until we get there.
BENMARK: In places where casinos have been successful, are there other factors like a neat-looking downtown, or scenic value, or other vacation sorts of things to do in the area, does that affect the economic effectiveness of the casino, or are people just mostly set on gaming, and don't care if it's, for instance, out in the middle of the desert like Vegas is.
HOLECEK: Yeah. Well, it used to be they would go anywhere to gamble, because there were so few places to go. But today, there are ample places to go. So, it's a combination of aesthetics, other things to do that will make a casino successful, and how successful it might be. So, I think the day of sticking a casino out in the middle of the desert and having people flock to it definitely are, that's over. There's just too many other closer in opportunities.
And location does matter. The vast majority of visitors to the casinos, it's a secondary purpose. So, it's to go up north on vacation and then catch a couple casinos while you're up there. In our long-term study the reason why I kind of got involved in looking at casinos, was that our long-term study said that one of our product weaknesses was we didn't have nightlife activities in Michigan. And casinos provide that nightlife activity, and it kind of rounds out the overall tourism product.