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Long Island Business News
Nassau OTB parlors dwindling
by David Winzelberg
Published: December 9th, 2013
With
another office closing and more slated to follow, indications are Nassau County Off-Track Betting Corp. is trimming labor and real estate costs in
a continuing shift to automated gambling.
The latest Nassau OTB office to close will be the 4,800-square-foot
betting parlor on Sunrise Highway in Freeport, which should be shuttered
by the end of the year. Its landlord, owner of the Freeport Plaza
shopping center, wants to replace the betting office
with a more upscale tenant.
Nassau OTB officials said they may look to lease comparable space
somewhere else in the neighborhood – but they said the same thing after
closing their 6,000-square-foot Wantagh office two years ago, a branch
they’ve yet to replace.
Internet wagering and dwindling betting revenue has spurred the consolidation of Nassau OTB’s operations in recent years.
There were 15 betting offices in Nassau in 2003. By the end of February – when the 5,500-square-foot branch at the Green Acres Mallin Valley Stream is slated
to close – there’ll be just six.
The lease for the Valley Stream office is expiring, and the mall’s new
owner, Santa Monica, Calif.-based Macerich, wants OTB out.
Macerich, which paid Vornado $500 million for Green Acres in January, is
gearing up for a major renovation of the 1.8 million-square-foot mall,
and it has advised several underperforming merchants that their leases
won’t be renewed.
“We are looking at doing a redevelopment and a re-merchandising mix of stores,” mall manager Joseph Floccari said.
Nassau
OTB Chairman Joe Cairo said the company would likely replace the Green
Acres location with another in the area. He said an ideal spot would be
between 4,000 and 6,000 square feet with ample parking.
Nassau OTB has had branches in Valley Stream since the mid-1970s – the
Green Acres office opened in 1996 – and Cairo said the neighborhood is a
money-maker. Since New York City OTB closed in 2010, the Valley Stream
branch has seen an uptick in activity, with
bettors coming from nearby communities in Queens.
“It gets a lot of traffic,” Cairo said.
But he added OTB’s Fast Track automated wagering system, placed in
restaurants and bars, is “the wave of the future” because it reduces
OTB’s labor and real estate costs.
Featuring touch-screen betting and video race simulcasts, there are 15
Fast Track locations throughout Nassau, in pubs such as Mulcahy’s in
Wantagh, Murphy’s Bar & Grill in Mineola and Edison’s Ale House in
Manhasset.
Predictably, the move to automated gambling hasn’t gone over well with
Nassau OTB’s 200 or so workers, who see the trend as a serious threat to
job security. That’s why their union, Teamsters Local 707, negotiated a
limit of 18 Fast Track locations in its latest
collective bargaining agreement with OTB.
Local 707 business agent Barry Yomtov said Fast Tracks aren’t a panacea
for Nassau OTB and only account for a negligible part of its revenue.
Yomtov said that most of OTB’s customers would rather do their wagering
at brick-and-mortar locations where they can
socialize and interact with cashiers.
“They don’t want to spend money on food and drinks when they don’t have to,” he said.
Yomtov added that only a small number of bettors will migrate to another OTB branch once their neighborhood office closes.
“It’s a local clientele,” Yomtov said. “They’ll likely lose that business.”
Besides the Fast Tracks, there is another revenue stream around the bend for Long Island’s OTBs.
In June, the state Legislature approved a measure that allows for up to
1,000 video gaming machines in both Nassau and Suffolk counties. Nassau
OTB is contemplating putting the machines at its branch at the Race
Palace in Plainview, a building it owns.
Suffolk OTB, which filed for bankruptcy last year, has chosen
Buffalo-based gaming company Delaware North to build and run its planned
80,000-square-foot gambling machine parlor, and it’s been looking for a
casino site along the county’s major thoroughfares.
Despite the closing of a couple of branches, Cairo said Nassau OTB is
doing better lately, and will likely turn a profit in 2013, after many
years of operating in the red.
“We’ll give more than $2 million to the county this year,” Cairo said.
Yomtov, who worked at New York City OTB for 39 years and witnessed its
demise firsthand, sees the closing of OTB branches a bit differently.
“It’s a sad situation,” he said. “This thing is disintegrating before our very eyes.”
David Winzelberg
Reporter
631.913.4247
917.796.1801
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