Last week, I made a quick tour of the five riverboat casinos in southern Indiana. Initially, my plan was to make the three-hour drive from St. Louis to Aztar's (NYSE:AZR) Casino Aztar Evansville to play in the pot-limit Omaha game there on Wednesday, and then continue to Harrah's (NYSE:HET) Caesars Indiana, near Louisville, Ky., to spend a couple of days playing in the side games during the Midwest Regional Poker Championships being held there. I did end up staying at Caesars on Wednesday and Thursday night, but having never been up toward Cincinnati, I decided to spend most of Thursday on a little recon mission covering the three casinos in that direction -- Pinnacle Entertainment's (NYSE:PNK) Belterra, the Grand Victoria, and Penn National's (NASDAQ:PENN) Argosy Lawrenceburg.

At least in my opinion, the real charm of true riverboat casinos is the view of the rivers they offer. Of course, in some places around the country, there isn't a whole lot to look at, but the riverboat casinos along the Ohio River offer some of the best views around.

The five casinos in the region between Evansville, Ind., and Cincinnati -- an area that takes about four hours to drive across -- generated $1.16 billion in gaming revenue during Indiana's fiscal year ended June 2005.

Southern Indiana Casino Gaming Revenues

Casino

FY 2003

FY 2004

FY 2005

Argosy Lawrenceburg

$392M

$430M

$444.5M

Caesars Indiana

$274.9M

$290.1M

$296.8M

Belterra

$125.7M

$140.6M

$156.2M

Grand Victoria

$138M

$143.9M

$148.8M

Aztar Evansville

$112.2M

$119.4M

$122.1M

Source: Indiana Gaming Commission

Qualitative tests
As we've discussed before, the first rule in casino success is location. Being located closer to more highly populated areas with fairly wealthy residents is a big plus, as are high visibility, easy access, and little competition.

That said, Argosy Lawrenceburg's proximity to Cincinnati, easy highway access, and the lack of competition between the casino and its primary Cincinnati market all serve to make the property perhaps the most successful among the riverboat casinos in the entire industry. Similarly, the Caesars location just across the river from Louisville has served that property well. On the other hand, the Belterra and Grand Victoria -- both situated in between Cincinnati and Louisville -- are handicapped by poor road access, poor visibility from the highway, and location disadvantages relative to Argosy and Caesars.

But there are a few other basic tests I like to use to evaluate a riverboat casino on a more qualitative level -- things like the type of games available, the convenience of escalators, and the quality of the poker room.

Casino Aztar Evansville
The focus of the bidding war over Aztar (see "Pinnacle Gambles on Aztar" and "Gauging Aztar's Value"), a battle that involves Pinnacle Entertainment, Colony Capital, and Columbia Sussex, is Aztar's Tropicana-branded resort properties in Las Vegas and Atlantic City, N.J. (Ameristar Casinos (NASDAQ:ASCA) had been in the running, too, but announced on Wednesday that it has dropped out of the Aztar race.) But while that battle rages, it shouldn't be overlooked that Casino Aztar Evansville, located about 20 miles off I-64, was the company's second-biggest contributor in 2005 in terms of earnings before interest, taxes, depreciation, and amortization -- it produced $41 million in EBITDA on $137 million in net revenue.

The property's best asset is its location. While Evansville is very much a second-tier market, the casino is located smack in the downtown along the riverfront, at the very tip of a horseshoe shape in the Ohio River. I-164 breaks off from I-64 and deposits you almost right at the casino's doorstep. Not only does this spot offer perhaps the most magnificent view among the five casinos along the river, but the casino also faces no immediate competition -- its nearest competitor at the moment is Caesars Indiana, two hours away.

I arrived at the property at around 5 p.m. on Wednesday, parked in the garage, and boarded the casino via the adjacent land-based facility. The land-based facility is of good quality and features several dining options, including a steakhouse and a BBQ joint, as well as a Starbucks outlet.

However, the riverboat itself is second-class. The boat -- featuring 1,357 slots and 52 table games on 38,360 square feet of gaming space on three levels -- is nicer than I remembered it from my visit last October. And it's certainly a level ahead of its sister casino in Caruthersville, Mo., though that isn't really saying much. The slots need an upgrade -- many of them are still coin-pay (the bottom floor is advertised as being 100% token pay), while the rest of the industry is moving toward 100% coinless slots.

The main attraction is the $2/$5 blind-pot-limit Omaha game that runs on Mondays and Wednesdays in the poker room, located on the bottom floor. Pot-limit Omaha is something like Hold 'Em on steroids -- it's essentially played the same as Hold 'Em, except that every player gets dealt four cards instead of two and must play two cards from his or her hand at showdown. As a result, the hands run much bigger in Omaha than in Hold 'Em. And that makes pot-limit Omaha by far the biggest game in every card room in which it is played.

Pot-limit Omaha is spread most prominently throughout the Midwest and South, and as far as I know, the game at Casino Aztar Evansville is the smallest and most accessible of them all. The poker room at Casino Aztar Evansville also regularly runs Stud and $5/$10 and $10/$20/$30 Hold 'Em, as well as tournaments. Moreover, the comps are easy to get.

Whoever takes over Aztar will have to upgrade the riverboat. Of the suitors, Ameristar did have the simplest solution in that it could have floated its boat from Council Bluffs, Iowa, out to Evansville and replace that boat with a larger facility, though that's no longer relevant since Ameristar is out of the running for Aztar. Meanwhile, Aztar is currently in the process of adding a 100-room boutique hotel (the property already has a 250-room hotel in place), as well as a multivenue dining and entertainment complex.

In part 2 of our look at southern Indiana's floating casinos, we'll examine Caesars Indiana and the Belterra Casino Resort. And in part 3, we'll take a look at the Grand Victoria and the Argosy Lawrenceburg.

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Fool contributor Jeff Hwang owns shares of Starbucks and Ameristar Casinos. The Motley Fool has a disclosure policy.

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