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Wed October 9, 2013

High-End Extras Aren't A Sure Bet For Tribal Casinos

Originally published on Wed October 9, 2013 6:53 am

What used to be no-frills slot parlors off the highway are turning into resort-style destinations with spas, golf courses and luxury hotels. Native American tribes are hoping these added amenities will give them an edge in an increasingly competitive gaming market.

Three years ago, Northern Quest Resort and Casino in eastern Washington opened a luxury spa that's been on the covers of DaySpa and American Spa magazines. La Rive Spa has its own seasonal menu and moisturizers that cost as much as an iPod.

Nothing about this spa screams casino, by design. Spa director Yvonne Smith says it's not what you'd expect from a casino in a field outside of Spokane. "The one thing I hear all the time is, 'Oh my gosh, I had no idea this was here,' " she says.

Across the country, tribes are trying to step up their game. Casino profits plus more interest from investors have funded new spas, fine dining, concert venues and other amenities. Phil Haugen, a Kalispel Tribe member and manager of Northern Quest, says tribal casinos are now drawing clientele that might have otherwise chosen a weekend in Las Vegas or at a resort.

"It used to be that people thought tribal casinos were dirty and small and that they just didn't have what Vegas had or what Atlantic City had," Haugen says. "But now you have these first-class properties."

Getting To The Gaming Floor

Out at the Circling Raven Golf Club in Worley, Idaho, Rhonda Seagraves drives her ball toward the first hole. Seagraves is a banker in north Idaho. She says this course at the Coeur d'Alene Casino is one of her favorite places to golf.

"It was just like this little hole in the wall, and now, it's just spectacular," Seagraves says.

But she says she is unlikely to gamble after her round — which runs counter to what these casinos are banking on.

"Those amenities are really designed to get people in and start gaming," says Valerie Red-Horse, a financial analyst who specializes in tribal casinos.

Even with the resort amenities, these ventures still make 80 to 90 percent of their revenue from gambling. Red-Horse calls golfing and spas a loss leader.

"We had a client that had a beautiful facility, one of the prettiest markets I've ever worked in in New Mexico, actually. And it had big picture windows in the resort, and they had camping and they had hunting and they had skiing. Well, they found they were not making money because people were not going to the gaming floor," Red-Horse says.

The casino restructured its debt and hired a management team that specialized in gaming.

In Idaho, former Coeur d'Alene Casino tribal chairman Dave Matheson has watched the operation grow from a buffet in a bingo hall to a restaurant with an award-winning chef. Matheson says the swanky expansions do drive business, but they're also a source of pride.

"And I think it gives us a chance to prove what we can do," Matheson says.

The Coeur d'Alene Tribe's casino has expanded so much in the last few years, it's been dubbed by workers "the world's most hospitable construction site."

Copyright 2013 NWNews. To see more, visit http://www.nwnewsnetwork.org/.

Transcript

STEVE INSKEEP, HOST:

Many Native American tribes are giving their casinos a makeover. What used to be no-frills slot parlors off the highway are turning into resort-style destinations with spas, golf courses and luxury hotels. Tribes are hoping the added amenities will give them an edge in a competitive market.

But as the Northwest News Network's Jessica Robinson reports, the high-end extras are not a sure bet.

(SOUNDBITE OF SLOT MACHINES)

JESSICA ROBINSON, BYLINE: Let's face it: there's not much ambiance in a room with a thousand slot machines. Or maybe it's really that there's too much ambiance.

(SOUNDBITE OF SLOT MACHINES)

ROBINSON: This is the gaming floor at Northern Quest Resort & Casino in Eastern Washington, near Spokane. But walk about five minutes from the flashing lights...

(SOUNDBITE OF MUSIC)

ROBINSON: ...and you find a very different atmosphere.

YVONNE SMITH: Well, welcome to La Rive Spa. Our name, it's French for the river.

ROBINSON: This is Yvonne Smith, the spa director.

SMITH: You can hear water in the background. We have a beautiful, etched waterfall that greets our guests before they go into the lounges.

ROBINSON: Nothing about this space screams casino, by design. Since opening three years ago, the spa has been on the covers of DaySpa magazine and American Spa magazine. It has its own seasonal menu and moisturizers that cost as much as an iPod. Smith says, yeah, it's not what you'd expect from a casino in a field outside of Spokane.

SMITH: Oh, the one thing I hear all the time is: Oh, my gosh. I had no idea this was here.

(LAUGHTER)

ROBINSON: Across the country, tribes are trying to step up their game. Casino profits plus more interest from investors have funded new spas, fine dining, concert venues and other amenities. Phil Haugen, a Kalispel Tribe member and manager of Northern Quest, says tribal casinos are now drawing clientele that might have otherwise chosen a weekend in Vegas or a resort.

PHIL HAUGEN: It used to be that people thought tribal casinos were dirty and small, and that they just didn't have what Vegas had or what Atlantic City had. But now, you have these first-class properties.

ROBINSON: Out at the Circling Raven Golf Course in Worley, Idaho, Rhonda Seagraves drives her ball toward the first hole.

(SOUNDBITE OF A GOLF STROKE)

ROBINSON: Seagraves is a banker in North Idaho. She says this course at the Coeur d'Alene Casino is one of her favorite places to golf.

RHONDA SEAGRAVES: It was just like this little hole in the wall. And now, it's just - it's spectacular.

ROBINSON: So you're down here golfing, are you going to gamble as well?

SEAGRAVES: No, I'm probably going to head home after this.

VALERIE RED-HORSE: Those amenities are really designed to get people in and start gaming.

ROBINSON: Valerie Red-Horse is a financial analyst who specializes in tribal casinos. Even with the resort amenities, she says these ventures still make 80 to 90 percent of their revenue from gambling. Red-Horse calls golfing and spas a loss leader.

RED-HORSE: We had a client that had a beautiful facility. One of the prettiest markets I've ever worked in New Mexico, actually. And it had big picture windows in the resort and they had camping, and they had hunting, and they had skiing. Well, they found they were not making money because people were not going to the gaming floor.

ROBINSON: The casino restructured its debt and hired a management team that specialized in gaming.

(SOUNDBITE OF KITCHEN AMBIENCE)

ROBINSON: A kitchen worker polishes the silverware before dinner at the fine dining Chinook Restaurant in the Coeur d'Alene Casino. Former Coeur d'Alene tribal chairman Dave Matheson has watched this operation grow from a buffet in a bingo hall to a restaurant with an award-winning chef. Matheson says the swanky expansions do drive business, but they're also a source of pride.

DAVE MATHESON: And I think it gives us a chance to prove what we can do.

ROBINSON: The Coeur d'Alene Tribe's casino has expanded so much in the last few years, it's been dubbed by workers: The World's Most Hospitable Construction Site.

For NPR News, I'm Jessica Robinson in Coeur d'Alene, Idaho. Transcript provided by NPR, Copyright NPR.