Portsmouth’s tourism sector has seen unprecedented growth, largely due to the success of Rivers Casino Portsmouth and an increase in visitors to the city’s expanding entertainment options. However, the boom has revealed a significant obstacle: a lack of hotel accommodations, leaving city officials looking for solutions.

Since its January 2023 opening, Rivers Casino Portsmouth has driven a major economic uplift. The casino, which includes 1,450 slot machines, 60 table games, and a BetRivers Sportsbook, generated $250 million in gross gaming revenue (GGR) in 2023. That number increased in 2024 to $310 million, contributing nearly $35 million in tax revenue to the city. The casino also boasts a 3,000-seat entertainment center, a Topgolf Swing Suite, multiple dining venues, and meeting spaces, attracting a steady stream of visitors to the area.

The overall impact on tourism has been significant. According to the Virginia Tourism Corporation, direct visitor spending in Portsmouth reached $138.3 million in 2023, marking a 118% increase from 2022. The city collected $5.6 million in local tourism-related taxes, surpassing pre-pandemic 2019 levels, when visitor spending totaled $61.4 million with $3.4 million in tax revenue.

While the casino played a key role in boosting visitation, other factors have contributed to the rise in tourism. Portsmouth’s LeMans Karting facility expanded, new restaurants opened, and Norfolk’s cruise ship dockings increased, bringing more visitors to the area. Additionally, the Renaissance Portsmouth Waterfront Hotel reported one of its best years for group bookings in 2023.

Economic Development Director Brian Donahue, cited by The Virginian-Pilot, emphasized that the city is finally seeing its long-touted tourism potential become reality. “Portsmouth, I think it’s always said, has a tremendous amount of potential, but I would say that this is potential being realized,” Donahue said.

Portsmouth’s Growing Tourism Highlights Hotel Shortage

Despite the surge in tourism, Portsmouth’s hotel inventory remains limited, with fewer than 500 rooms available citywide. By comparison, Norfolk offers nearly 1,800 rooms, creating challenges for visitors who want to stay in Portsmouth but are forced to seek accommodations elsewhere.

“We don’t have enough hotel rooms,” Tourism Director Keith Toler stated. “A conference that’s coming in March has over 70 people staying in Norfolk because we don’t have hotel rooms for them.”

The shortage is not just affecting conferences. Data from Arrivalist, a travel analytics firm, revealed that in 2023, most visitor spending came from day-trippers within Hampton Roads, followed by overnight guests from Richmond, Washington, New York, and Raleigh. Fridays and Saturdays were the busiest tourism days, reflecting Portsmouth’s appeal as a leisure destination.

A potential solution lies within Portsmouth’s agreement with Rush Street Gaming, the casino operator. If Rivers Casino meets revenue thresholds—$175 million in GGR in a single year or $250 million over two consecutive years—while competing against another casino in the region, Rush Street would be required to build a hotel.

With Boyd Gaming constructing a $750 million casino resort in Norfolk, which includes a 200-room hotel, Portsmouth’s revenue conditions may soon be met, triggering Rush Street’s obligation to begin hotel development.

However, Rush Street Gaming has a history of delaying or avoiding hotel construction at its casinos. The company only added a hotel to its Pittsburgh casino over a decade after opening and recently partnered with a hotel 13 years after launching Rivers Casino Philadelphia. If Rush fails to act in Portsmouth, the city’s Economic Development Authority can take over the project and seek another developer. As of now, Rush Street has not provided an update on its hotel plans for Portsmouth.