MGM: ‘Full steam ahead’ despite competition

March 2, 2017 | G. Michael Dobbs
news@thereminder.com

This long-closed Showcase Cinemas adjacent to Interstate 91 in East Windsor, CT, is the proposed site for a casino designed to directly compete with MGM Springfield.
Reminder Publications photo by G. Michael Dobbs

SPRINGFIELD – While a stock analyst has strongly advocated MGM Resorts International to sell its Springfield casino, now under construction, to the two Native American tribes who operate the casinos in Connecticut, an MGM spokesperson expressed equal enthusiasm for the casino company to stay in Springfield.

MGM spokesperson Carole Brennan told Reminder Publications, “MGM is as committed to MGM Springfield today as it was when we were awarded our license in 2014. It’s full steam ahead to a September 2018 opening.”

Howard Jay Klein, writing on Feb. 22 for the website Seeking Alpha summarized that “a cross-border war has erupted between MGM and Connecticut's two tribal operators. There will be no winners in this war of attrition.

“MGM’s $950 million Springfield casino hotel project gets shaky if the tribes get to build a fighting brand casino closer to the core Hartford-New Haven market.

He concluded, “By selling the deal to their adversaries, MGM can deleverage a possible 8 percent off their $12.4 billion debt load and still participate in the upside.”

Klein added, “The recent history of gaming legalization in the state of Massachusetts bears the twisted complexities of a Shakespearean play in which dualities of character, events and human flaws interact to produce drama. We will spare readers the play-by-play and will only observe that in the heated competition for three licenses there, the biggest winner was Wynn Resorts Ltd. Wynn emerged from the steel cage battle among contenders with the big prize: A casino license for a parcel in the heart of metro Boston.

“The other two licenses went to Penn National Gaming for a slot parlor now open, and the third to MGM in the western part of the state at Springfield, a location that bore a faint echo of Atlantic City in the late 1970s. The project in the deteriorating downtown was hailed as a paean to urban renewal as well as a casino hotel. Planned with a 125,000 square foot casino with 495 rooms, the development stands six miles away from the Connecticut border, only 30 miles from the lucrative Hartford-New Haven market. This project’s potential to make a frontal assault on that market, currently one of the sweet spots for the two Connecticut Tribal properties (Mohegan Sun and Foxwoods), sent tribal and state officials into a war mode. They currently sit around one hour away from that market and have no illusions about the possible impact it may have on their businesses.”

A sale of any casino established in the Bay State is possible under the legislation authorizing casino gaming. Elaine Driscoll, a spokesperson for the Gaming Commission explained, “A gaming license, or gaming establishment, can be transferred in whole or part with Commission approval. Of course, we have a process for that in which the Commission may reject any transfer that it finds would be ‘disadvantageous to the interests of the Commonwealth of Massachusetts.’”

The Day reported on Feb. 26 the East Windsor, CT, Board of Selectmen approved a proposed development for a third casino – a partnership between the two tribes – at the location of a long closed Showcase Cinema that borders Interstate 91.

MGM has been fighting the process of developing the third casino that is obviously aimed at blunting the impact the Springfield casino will make in the Connecticut market.

According to the report, legislation must now be passed by Connecticut to make the third casino a reality.

Reminder Publications also contacted the city of Springfield to see if the Host Community Agreement addresses the concept of a sale or transfer. No response was received by press time.

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