Suffolk OTB, officially known as the Suffolk County Regional Off-Track Betting Corporation, has fulfilled a dream it had four years ago. In 2017, the company had plans to convert a Marriott hotel on Long Island to a casino, but there was just one problem – it had no money. The company was on the rebound following a bankruptcy in 2011 and couldn’t afford the purchase. It worked out a deal with Delaware North that saw the latter step in and buy the property while allowing Suffolk to run it. Now, Delaware is handing over the keys in a deal reportedly worth around $120 million.
Suffolk OTB Expands New York Footprint
The Marriott Islandia was put up for sale in 2016 and Suffolk wanted it. It envisioned converting the 10-story building into a casino, but couldn’t come up with the funds. Delaware North stepped in to acquire the property, rebranding it to Jake’s 58 and bringing in Suffolk to cover operations. Given that Delaware North paid around just over $40.4 million for the purchase, its sale to Suffolk, despite renovations and upgrades, should have given it a nice payday. This is in addition to the money Suffolk has been paying each year to lease the property’s gaming activity.
Suffolk has three OTB gambling facilities on Long Island, as well as kiosks located in bars, restaurants and convenience stores in the area. Adding Jake’s 58 gives it a more commanding presence in the region while allowing the company to finally realize its dream. It is also an indication that Suffolk has rebounded from its bankruptcy and could be prepared to seek new options, especially as New York begins to embrace sports gambling.
Jake’s 58 Performs Well in Post-COVID-19 Environment
Since opening in 2017, Jake’s 58 has been an important part of Long Island and has achieved a significant amount of success. The gaming floor offers a wide variety of slot machines and VGT options and, although it was shut down last year due to COVID-19, it has rebounded substantially, making up for lost time. Just since September, the casino has received $1.7 billion from gamblers and picked up a little more than $104 million in revenue. In addition, 45% was paid to the New York State Education Fund, with another 10% going to equipment providers and the New York Lottery. s
That success most likely helped Suffolk cover some of the purchase price, but not all of it. The company had the option to acquire Delaware North’s portion written into the original management contract and has probably been preparing for the acquisition ever since. Delaware North isn’t going to see a blow to its bottom line, as it still has operations in other parts of New York, as well as in Arizona, Arkansas, Florida, Illinois, Ohio, West Virginia and Australia.