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November 25, 2024

XL Center’s Fanatics Sportsbook off to better start in FY25; operating loss still projected

HBJ PHOTO | DAVID KRECHEVSKY The Fanatics Sportsbook site at the XL Center in Hartford.
By David Krechevsky

After a rough first year marked by a change in state vendors and a six-figure loss, the Fanatics Sportsbook restaurant and bar at the XL Center is off to a better start in the new fiscal year.

According to figures reported by the Connecticut Lottery Corp. (CLC), the state has received $24,955 in sports wagering tax revenue from the facility so far for fiscal 2025, which began in July. 

While just a bit over halfway through the fiscal second quarter, the venue has already produced 44.2% of the $56,476 in tax revenue the facility produced for the state during all of the previous fiscal year.

The sportsbook restaurant and bar opened on the Ann Uccello Street side of the XL Center in September 2023 and struggled to find its footing during its first year. According to the Capital Region Development Authority (CRDA), the venue ended the 2024 fiscal year in June with a loss of about $500,000.

Both the CLC and CRDA attributed the venue’s underwhelming performance in its first year to a change in state bookmaking vendors. The original bookmaker, Chicago-based Rush Street Interactive, announced in March 2023 that it would exit the market because it wasn’t profitable enough.

It took until December 2023 for the state to name New York-based Fanatics Betting and Gaming as the replacement. Fanatics signed an eight-year contract.

CRDA Executive Director Michael Freimuth said the vendor change so soon after the venue opened had a detrimental effect.

“Last year, the bulk of the football gaming season was missed,” he said. “We had just opened, and people didn’t widely know about it.”

He noted that, since Rush Street was ending its contract with the state, it did not spend money to advertise the venue.

“When Fanatics came on board, they invested in advertising, specifically before this football season,” Freimuth said. “The XL Center also spent on advertising the lounge at the same time.”

While the tax revenue from sports wagering has improved, the restaurant and cafe continue to struggle. Freimuth told the CRDA board during its meeting last week that through mid-November the venue had posted a loss of $192,000, while adding that “is right in line with where we thought we would be during these first three months.”

The CRDA has budgeted for a $600,000 loss for fiscal 2025 for the venue, he said. 

“Revenues are not expected to cover minimum staffing levels,” Freimuth told the Hartford Business Journal. “We need a minimum number of staff to meet any demand. We found that we need steady hours of operations; if we fluctuate them, it’s too complicated for customers to know what to expect if they come in for lunch or the weekend. If we’re not open, they won’t try again.”

He said the menu is “bar standard, a higher standard than concession stands, which means we have higher food costs. And there is specific insurance we need solely for the lounge.”

The cafe also experimented in the previous fiscal year, “trying different menus, staffing levels, hours of operations,” Freimuth said. “There was something different that we tried almost every other month. This year, once football season started, we have stayed with the same operating model.”

Andrew Walter, director of sports betting for the Connecticut Lottery Corp., said the state is pleased with the results for the 2025 fiscal year so far.

“We will continue to work collaboratively with CRDA on opportunities for promotions and other ways to engage customers and make sure people know about both the food/beverage/viewing opportunity and the sports betting,” Walter said.

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