The opening of Norfolk’s long-awaited temporary gaming facility next to Harbor Park means more competition on the horizon for Rivers Casino Portsmouth, which opened in 2023 as the first permanent casino in Virginia.
The anticipated opening of a hotel at Rivers Casino in 2027 as well as casino earnings that show no signs of slowing suggest a positive financial outlook, at least for now. And Portsmouth has an advantage by being the region’s first, while Norfolk will have to catch up.
But the long-term outlook is less certain. Perhaps the bigger threat to the livelihood of both casinos has less to do with their proximity to one another and more with economic challenges and changes in the gaming industry.
“There is a market for casinos, but over the next year or two, it’s going to be an increasingly challenging market in the short-term because of economic conditions, and in the long-term because of ongoing gambling and other alternatives,” said Bob McNab, an economist at Old Dominion University.
Casino revenues
Portsmouth’s 250,000-square-foot gaming facility, along Victory Boulevard near Missy Elliott Boulevard, boasts more than 1,400 slot machines, nearly 60 tables, two dozen poker tables, a handful of restaurants and bars and more than 25,000 square feet of event space.
Norfolk opened its doors earlier this month to a temporary tent-like structure dubbed The Interim Gaming Hall with 132 slot machines. The permanent casino is expected to open in the fall of 2027 with a 65,000-square-foot gambling hall, a 200-room hotel and a parking deck, plus several restaurants, a pool deck overlooking Harbor Park and a spa.
The Interim Gaming Hall in Norfolk with 132 gaming machines Thursday morning, Nov. 6, 2025. The temporary casino will be open 7 days a week from 10 a.m. until 2 a.m. (Bill Tiernan/For The Virginian-Pilot)
When Rivers Casino opened, city leaders projected about $16 million in annual tax revenue. And so far, the casino has met and exceeded those estimates.
In 2023, Rivers Casino generated $249 million in total revenue, which amounted to a share of $15 million in tax revenue for Portsmouth, according to the Virginia Lottery’s monthly earnings reports. In 2024, Rivers reported $310 million in total revenue and nearly $20 million in tax revenue for the city.
And 2025 is on track to surpass the past two years. As of October, Rivers has generated $264 million in total revenue, yielding at least $16 million for Portsmouth.
It’s common, according to economists, for casino revenues to come in high before declining or leveling out over time. Current projections in Norfolk estimate anywhere between $15 million and $30 million in annual tax revenue for the city once the permanent casino is fully operable.
Challenges ahead
Though the introduction of another casino in Hampton Roads does stiffen the competition, Rivers Casino has established itself with a “first mover advantage,” McNab said. That’s important as a 2019 report from the Joint Legislative Audit & Review Commission estimated that only 9% of Portsmouth and Norfolk customers would be from out of state.
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That data, McNab said, underscores the challenge that neither Portsmouth nor Norfolk are considered “destination locations” that would draw in more outside visitors — from Raleigh or Charlotte, for example. And the establishment of a casino in Petersburg will further limit the ability to draw interest from Northern Virginia.
“(Rivers Casino) has worked hard to build a clientele and a customer base and loyalty, and the question will really be whether Norfolk can come in and grab some of that market share, because they are, in effect, competing for many of the same customers,” McNab said.
The affordability crisis most Americans are facing further limits the amount of money spent on entertainment in the region, he said, as evidenced by a decline in casino activity in destination locations such as Las Vegas.
That means casinos are “competing with the increasing cost of health insurance, car insurance, rent, and food,” he said.
“If you’re not earning more than $130,000 a year, your increases in income have barely been enough to keep up with inflation, not get ahead,” McNab said. “If you look at who’s within two hours of Portsmouth and Norfolk, it’s the residents of Hampton Roads, and most of those residents don’t earn more than $130,000 a year.”
But perhaps a bigger risk to either casino’s bottom line is the rise of online betting, as well as ongoing attempts to legalize and regulate skill games, McNab said.
“Now the physical casino is really battling for consumer attention when the consumer has almost every form of betting they want in their pocket,” McNab said. “They could sit at home and buy a lottery ticket. They could sit at home and bet upon the score in a football game, the next snap in a football game.”
Boon to cities, but not region
The additional casino revenue has been a boon to a city like Portsmouth, where 40% of its land is tax-exempt due to state or federal ownership, which limits the city’s ability to generate tax revenue for its fiscal budget. Portsmouth has used $39 in casino revenue over the past two calendar years to reduce local tax burdens for residents and invest into local schools, among other things.
“Together, these actions demonstrate Portsmouth’s commitment to leveraging new revenue sources, such as casino gaming, to strengthen essential services, support public education, and deliver meaningful tax relief for residents,” a city spokesperson said.
Guests play a variety of games at Rivers Casino in Portsmouth, Virginia, on Jan. 21, 2025. (Billy Schuerman / The Virginian-Pilot)
Casino revenue helped increase funding to Portsmouth Public Schools by $18 million over the past two years. And for the 2025 budget, Portsmouth used casino revenue to enact a tax credit of 6 cents on the real estate tax rate.
Additionally, about $3 million was used to increase personal property tax reductions for residents.
“Since day one, Rivers Casino Portsmouth has been dedicated to serving the region as a strong economic engine, proud community partner, and great place to work,” a spokesperson for the casino said in a statement.
Earlier this year, Rivers Casino broke ground on The Landing Hotel, an eight-story, 106-room building adjacent to the casino. When the hotel opens in early 2027, the city will collect real estate taxes as well as hotel occupancy taxes. It’s too early to project what those revenues will be as it will depend on what’s charged per room, according to the city.
Casino revenue tends to benefit host cities, but the net economic impact for the area is mainly a wash, McNab said, noting casinos don’t produce the type of high-paying jobs that benefit the region.
“At a regional level, you’re just basically moving entertainment dollars from one function to another, or one location to another.”
But Portsmouth leaders are capitalizing on the moment — and increased tourism growth — to draw on the casino’s success and embark on “transformational” development along the city’s waterfront and elsewhere. Portsmouth is working to build up an Innovation District aimed at attracting high-paying industry jobs, while an entertainment district built around the casino will increase mixed-use residential and commercial options.
“Portsmouth has wisely decided, in my opinion, to leverage this casino and emerging hotel to build up an entertainment district to promote economic development rather than relying solely upon the casino to fuel economic development,” McNab said.
“And that is a wise strategy, because at the end of the day, why are people going to come and stay in Portsmouth? It’s got to be more than just the casino.”
Natalie Anderson, 757-732-1133, natalie.anderson@virginiamedia.com
