New York State Gaming Commission appointed a special board to oversee bidding process for new state casinos.
Last November voters have approved a referendum put forward by New York Governor Andrew Cuomo, allowing construction of new casinos in the state. A decent number of developers have already expressed interest building a casino in the “Borscht Belt” or Catskills as the historic territory is officially known.
The State Gaming Commission has already made the necessary amendments to American gambling laws and have appointed a board to solicit bids for the project starting on March 31st. The introduction of four new casinos upstate is regarded as an attempt to help struggling communities, one or even two casinos are expected to be built in the Catskills.
The State Gaming Commission board will start soliciting construction bids on Monday all the way until June. The winners will be officially announced in autumn and they will have two years to construct the properties and open their doors to guests and gamers.
All applying developers need to shell out $1 million simply to be considered. Michael Treanor, CEO of one of the developers, has been quoted in American gambling news: “That process will weed some people out.” His group is looking to construct a $470 million casino, hotel and golf course in place of the old Nevele hotel in Ellenville.
The prospects of building a casino in the Catskills has been on the minds of developers for decades now. The obvious benefits of being extremely close to New York City are undeniable. Nearly all elected officials in the region have always supported such plans, looking to try and make up for the former years of larger Catskills resorts.
Chief Executive Officer of EPR Properties, commented that the Catskill region is “emotionally connected to the people of New York. People would like to see that reinvigorated.” His real-estate investment trust has already formed a partnership with Empire Resorts Inc. planning to build a $600 million casino, hotel and water park.
Other interested developers and previous efforts
The list of already known applicants includes Empire Resorts Inc., New York’s Flaum and Muss families, Len Wolman – Connecticut-based developer, as well as Louis Cappelli, who’s been looking to construct a casino on the grounds of Concord Resort Hotel for years now.
Bids for New York state casinos are expected to start this week
•Changes in American gambling laws allowed new casino resorts to be constructed in New York
•The Catskills region is expected to get 2 casino resorts
•Developers are lining up for the bidding process
Previous efforts to erect gambling properties in the state have encountered lots of problems. Both Indian tribes and property owners have been fighting hard against plans to established casinos in the Catskills.
The general report by the state inspector in 2010 revealed that the Senate leaders have altered the selection process for the operator of racino property at Aqueduct Racetrack in Queens. The story ended when the state has chosen Genting Group subsidiary to run the property.
New governing body
This time around a special board has been set up by the State Gaming Commission in order to review all applicants and ensure fair process. There are two seats on the board left unfilled. The current members are Paul Francis – the founder of Cedar Street Group, President of Hofstra University – Stuart Rabinowitz, and former New York City mayoral candidate – William Thompson Jr.
The chairman of the State Gaming Commission, Mark Gearan, said: “Integrity is paramount,” after the board members were appointed in February this year.
The state board will announce important details this week: the minimum investment amount and the licensing fee cost. The developers expect the latter to be set at around $50 million. The board will be heavily focusing on the economic activity the casino projects will be generating when deciding who wins the bid. Local impact and workforce development will also play a part in determination.
What are bidders up to
Currently, the potential bidders are in various stages of preparing their applications. Mr. Treanor has already revealed that the terms for debt and equity financing have been settled, but the final agreement with lenders and investors is yet to be reached.
Chief Operating Officer at Muss Development, Jeffrey Kay, said that his company is “100% confident that by the time we submit the [application] we can announce financing.” He is working closely with Mashantucket Pequots, who operate the Foxwoods Resort Casino in Connecticut, on building a 350-room resort with a golf course near Grossinger Hotel in Liberty.
The lead developer of Mohegan Sun in Connecticut, Mr. Wolman, has agreed to work with the Stockbridge-Munsee Indians. The tribe has been looking to build a casino in Thompson for over a decade. Their current plans include erecting a $350 million commercial casino on the Neversink River site.
The Flaum family has purchased a site in Harriman, 50 miles from New York City. They plan to advertise the site as having the best potential from the touristy point of view. It’s placed right next to the extremely popular shopping outlets of Woodbury Commons, close to Metro-North train station, and just a stone throw away from Manhattan.
However, there will be a limit of 2 casinos per region. The Catskills are expected to get two, due to the fact that visitors will be mostly attracted to this region given a choice.