Foxwoods AC?

In the early 1990s, competiton from Foxwoods forced many changes on the Atlantic City casino industry, most of them good: new games like keno and poker, 24-hour gaming, and several others. Now, Foxwoods, arm-in-arm with MGM Mirage, might–might–be coming to the World’s Favorite Playground. From the AC Press:

The American Indian tribe that struck it rich in the 1990s with the opening of the Foxwoods casino in Connecticut may build an Atlantic City casino in partnership with gaming giant MGM Mirage.

A new casino by the Mashantucket Pequot Tribal Nation is being discussed for a 14-acre site owned by Las Vegas-based MGM next to Trump Marina Hotel Casino in the city’s Marina District, the rapidly growing casino cluster that includes Borgata Hotel Casino & Spa and Harrah’s Atlantic City.

The proposed casino is mentioned in an April 24, 2006, memorandum of agreement for joint projects between the Pequots and MGM in Connecticut, Atlantic City and Las Vegas. MGM will invest as much as
$200 million to finance a portion of the tribe’s involvement in the projects through a venture called Foxwoods Development Co.

“Foxwoods Development Co. and MGM have the desire to jointly engage in the development of new casino hotels in Atlantic City and in the Las Vegas Strip market,” states the agreement, a copy of which was obtained by The Press of Atlantic City. “Specifically, MGM would offer to contribute a site of approximately 14 acres currently owned by MGM in Atlantic City adjacent to Trump Marina and the Mashantucket Pequot Tribal Nation would contribute an amount of equity equivalent to the appraised value of the land.”

Already, MGM and the Pequots are working together on a $700 million expansion of the Foxwoods Casino Resort in Ledyard, Conn., opening in spring 2008. Foxwoods, which opened in 1992, has become the world’s largest and reportedly the most profitable casino, although it does not publicly report its earnings under the Pequots’ ownership.

Currently, there are no Indian-owned casinos among Atlantic City’s 11 gaming halls. A new Marina District casino by the Pequots would put it in an area that is undergoing dramatic growth thanks to Borgata and Harrah’s.

Borgata, the city’s top-grossing casino, added a $200 million expansion last summer and is scheduled to open a $400 million hotel tower with 800 rooms late this year. Harrah’s will open the first parts of a $550 million expansion over the Presidents Day and Memorial Day weekends and plans to follow that up with a new 962-room hotel tower in 2008.

Despite their interest in Atlantic City, the Pequots could shift their attention from New Jersey to Philadelphia, where they are planning to open a new $560 million Foxwoods casino on the Delaware River waterfront next year. In December, a group headed by Foxwoods was selected for one of two gaming licenses for new slot parlors in Philadelphia. SugarHouse Casino, an investment group that includes Chicago billionaire Neil G. Bluhm, won the second license and plans to build a $550 million slots parlor also overlooking the Delaware River.

MGM, meanwhile, also has hinted at plans for a new Atlantic City megacasino that it would develop separately from the Pequots. MGM, the world’s second-largest gaming company, already co-owns Borgata with Boyd Gaming Corp. and controls an adjacent 70 acres of land that it may use for its new casino project.

Terry Lanni, MGM’s chairman and chief executive officer, has spoken repeatedly of building something in Atlantic City called CityCenter East, a project inspired by the company’s $7 billion CityCenter West development in Las Vegas. Scheduled to open in late 2009, CityCenter West will include casino space, hotels, luxury condominiums, retail shops, restaurants and entertainment all wrapped up in one huge project.

Absher, MGM’s spokesman, cautioned that Lanni is using only “verbal shorthand” when he talks about CityCenter East. No architectural drawings or models have been developed yet and the project is considered only conceptual, Absher said.

Foxwoods owner, MGM Mirage talk of joint A.C. casino venture

I’ve got to disagree with the reporter’s contention that Foxwoods getting the Philly license will hurt their chances of building in AC. If anything, it increases the likelihood, because they’ll be able to do things with marketing that they wouldn’t with just one casino. It actually makes a lot of sense, if it is a bit sneaky–no companies with AC casinos got standalone PA licenses precisely because the Pennsylvania board didn’t want them just running “branch offices” to drive customers to bigger, posher (and less heavily taxed) Atlantic City casinos. It’ll be interesting to see if Sugarhouse (the other Philly casino) or Las Vegas Sands ever makes a move towards AC. Harrah’s with its Chester racino, obviously has its ducks in a row, because it’s in the middle of a $550 expansion at Harrah’s and is mulling major changes on the Center Boardwalk properties.

LOL @ “City Center West.” I’ve never heard anyone out here call it that, though it might be an internal corporate thing. Also, you’ve got to love “verbal shorthand.” Is that related to “verbal judo?”

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