Four Are in Casino License Process

January 16, 2013
By

Surprise and intrigue came late Tuesday for those following the casino discussion, with one mysterious proposal from Chicago develop Neil Bluhm joining proposals by Las Vegas gaming magnate Steve Wynn, Suffolk Downs owners and an older proposal in Milford as Phase I casino license applicants in Greater Boston – each paying a $400,000 licensing fee to begin the quest for a Greater Boston (Region A) casino license.

There were four definitive proposals submitted for Region A, and one absolute surprise proposal from PPE Casino Resorts in Baltimore (The Cordish Companies) that had no specifics as to where it would go or what it was seeking. Ironically, Cordish is the same company that Suffolk Downs principle Richard Fields partnered with to develop his first major casino in Florida (Seminole Hard Rock).

Bluhm’s proposal is equally vague, though it is somewhat certain that his Chicago company – which has developed casinos in Philadelphia, Illinois and Mississippi – is looking at several Boston sites for a casino. Nevertheless, it was also supposed that they could be seeking the slots-only license as well, though that is unlikely. Bluhm is a major contributor and supporter of President Barack Obama.

The fourth applicant, David Nunes of Colorado, has apparently partnered with Warner Gaming for his long-standing proposal in Milford (which is in Greater Boston region), called Crossroads Massachusetts LLC. That proposal includes a $700 million development with a 300-room hotel just off of I-495. It has been quietly in play for nearly two years.

In the end, the deadline added up to far more competition than anyone expected, given that Suffolk Downs appeared to be the only game in town just a few months ago.

For this immediate area, the coming and going of the initial filing deadline for the first-ever casino gaming license has resulted in what appears to be two of the biggest international faces in expanded gaming – Fields and Wynn – preparing to do battle in the backyards of Revere, Boston and Everett with well defined plans.

A total of 11 companies filed applications by the deadline.

Despite heavy competition for the western Massachusetts license, Suffolk – which has partnered with Caesar’s Entertainment – had been the lone interested party for quite some time in the Greater Boston area. All of that changed in late November when Wynn (who owns Wynn Resort and Casino in Las Vegas and a casino in Macau) re-entered the game. At that time, he virtually came out of left field with a proposal for a casino on a vacant parcel in Everett – a parcel formerly home to Monsanto site many years ago – and received a warm welcome from Everett Mayor Carlo DeMaria, Jr.

Wynn had unsuccessfully tried to bring a gaming complex to Foxboro with New England Patriots owner Robert Kraft in 2011, but was tossed out of town by a disinterested electorate in Foxboro. After that, many believed Wynn was no longer interested in Massachusetts.

However, his entrance and, later, securing a lease on the Everett property seemed to suggest otherwise, though many still did not believe he was serious about the proposal.

His application filing on Monday changed that for a lot of people and injected some unanticipated early competition for the Suffolk Downs proposal. Suffolk officials, though, said they never anticipated to be the lone applicant and were not surprised that Wynn and the others had gotten into the early process.

“We have always anticipated competition in the region and known that we will have to earn a license on the merits of creating the most jobs, revenue and local business partnerships, having the premier site with access to major highways and public transportation, committing to the best local road and infrastructure improvements and preserving one of the area’s historic sporting landmarks and its existing workforce,” said Chip Tuttle, chief operating officer of Suffolk Downs.

Wynn’s entrance was so sudden and so recent that many of his plans for the site are still murky. Last week, though, Wynn told the Boston Globe that he would build a $1 billion hotel tower on the site with a casino inside – housing about 300 to 500 rooms and being the “fanciest place in Boston.” He even touted it would have “short hallways” and “fast elevators” and would face the Boston skyline.

Wynn also pointed to the nearly flawless financial positioning of his company.

He also has the initial support of Everett Mayor DeMaria and some other local Everett officials. DeMaria cemented his approval of the casino plan in a statement on Monday that indicated Everett was ready to work with Wynn.

“I am very pleased that Mr. Wynn has filed an application with the Gaming Commission,” said DeMaria. “I look forward to open, honest and forthright conversations between the administration, business owners, residents and the developer. I know that this is a very exciting time for the City of Everett and the Commonwealth of Massachusetts and could lead to great things for our community.”

That said, most of Wynn’s plans are still in the design phase, and not much is known about his ideas for traffic mitigation. Though DeMaria has held a public meeting, Wynn has yet to schedule any public meetings in Everett. In fact, he has really only detailed his plans publicly to the Globe.

On Monday, after filing, Suffolk officials played up the fact that they are home to state’s only thoroughbred racing track and that they have been in the community for more than 70 years. They also pointed to the fact that they have had numerous public meetings, including two very detailed public meetings on traffic mitigation last fall.

“The process of earning a license requires significant investment and substantial resources and we have worked with our partners at Caesars Entertainment to assemble a best-in-class team as we move toward a second phase of larger public review of our plans to create thousands of jobs and improve the local economy,” said Joe O’Donnell, a principal owner of Suffolk Downs and a Cambridge-based entrepreneur and philanthropist who actually hails from Everett.

Added Suffolk principle owner Fields, “This is an economic development initiative that will set the standard for gaming development in Massachusetts and will create thousands of new jobs with real career paths and room for advancement. And it is built on a foundation of collaboration and partnership – with local residents and community groups; with local businesses; and with Boston’s entertainment, tourism and convention facilities.”

Suffolk also drew attention to the fact that it has hired former Boston Police Commissioner Paul Evans to head up security at the facility, and that Evans has already started meeting with law enforcement in Boston and Revere.

Suffolk rolled out plans and designs for its $1 billion resort casino last June, with a hotel, casino and other amenities connected to the historic horse track.

Principle owners for the Suffolk proposal were identified as Fields, O’Donnell, Gary Loveman (of Caesar’s) and Tuttle.

Other applicants to the MGC on Tuesday were mostly competing for the western Massachusetts license (Region B). They were MGM Springfield, Penn National Gaming, Hard Rock MA, and Mohegan Sun (to be in Palmer). There was also talk of a deadline waiver for a proposal in Chicopee, though it wasn’t certain if that would be allowed.

The Region C license, in southwestern Massachusetts and Cape Cod, is reserved for the Wampanoag American Indian tribe – who is still working out details on their process.

Plainridge Racecourse and Raynham Dog Track have applied for the one, statewide slots-only license. Some have speculated that the Cordish Companies could also be in the running for that license. The review for that license will take place first, according to the MGC, and will be awarded by the end of this year – or even perhaps a little sooner.

The MGC expects the Phase 1 application investigation to last some six to eight months, with all applications being private until the investigations are completed. That will be followed by a much more stringent Phase 2 process, which is still being designed by the MGC. Phase 2 regulations are due to be released this summer. Any applicant must have finished host community agreements, surrounding community agreements and won a host community referendum vote before applying to Phase 2.

The first resort-casino license is expected to be awarded on or before Feb. 26, 2014. Any casino development is expected to be fully open, perhaps, by 2016.

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