Rumors continue to swirl regarding MGM Resorts International’s possible sale of MGM Springfield in Massachusetts, possibly to the Mashantucket Pequot Tribal Nation and/or the Mohegan Tribe. Bloomberg recently reported the casino could soon be up for sale, along with a racino in Northfield, Ohio.
Originally alarmed by the proximity of MGM Springfield to southeastern Connecticut, the casino has not had the impact on the Foxwoods and Mohegan Sun casinos as the two tribes had feared.
According to the Day, Ray Pineault, Mohegan president and chief executive officer, said, “We are aware of the potential sale of MGM Springfield, along with other MGM assets. We regularly look at various opportunities that would continue to grow the Mohegan brand. As you are aware, we just opened our spectacular resort in Korea and have a team working tirelessly on preparing an exciting bid to compete for a New York downstate casino license.
“While these are large endeavors that consume a considerable amount of time and effort from our entire team, there are still many other opportunities that our team is exploring.”
Mashantucket Tribal Chairman Rodney Butler said his tribe is “always exploring opportunities to expand the Foxwoods brand.”
Acknowledging MGM’s challenges regarding the original investment and impact of the pandemic on MGM Springfield, Butler told the Day, “It’s a great market and why we were pursuing the casino in East Windsor that has been paused. We have certainly monitored it, but we have been hyper focused on redeveloping Foxwoods into one of the premiere resort entertainment destinations in the country.”
The tribes’ partnership, MMCT Venture, proposed developing a casino in East Windsor, Massachusetts in 2015 but put the project on hold for at least 10 years during negotiations that led to the state legalizing sports betting and online casino gaming in 2021.
Gaming expert Clyde Barrow, general manager at Pyramid Associates consultants and a public policy professor at the University of Texas Rio Grande Valley, said the acquisition of MGM Springfield by one or both tribes “makes a lot of sense, depending on the price.”
He noted MGM Springfield cost nearly $1 billion but has not lived up to revenue expectations because those expectations were unrealistic.
“It’s performed at a level we predicted. MGM Resorts have publicly admitted they overestimated the size of the market. We said at the time the market could sustain a $350 million to $450 million investment as opposed to the monument they constructed in Springfield.” The casino has done 40 percent to 50 percent of MGM Resorts’ revenue projections. “So, I’ll say, ‘I told you so,’” Barrow told the Day.
He added, “That’s not to say it’s not a viable casino at the right level of investment. Anyone purchasing it will be looking for a discount of what MGM paid. My barometer is if a property’s doing $350 million, that’s what I’m going to pay for it, at most.” MGM Springfield generated $278 million in gambling revenue in 2023.
Barrow noted the tribes were planning to invest $300 million to $400 million in their East Windsor project. Now, he said, it would make more sense to an existing casino rather than build a new one.
Meanwhile, Massachusetts and Springfield officials want to make sure MGM Resorts lives up to the promises it made in the city-host agreement.
Springfield Mayor Domenic Sarno said he’s going to meet with MGM Resorts International Chief Executive Officer Bill Hornbuckle to discuss the situation. Sarno told the Day, “I’m not going to be flexible at all and I am going to make sure that I fight for the best interests of the city of Springfield and our business community if something were to occur.”
State Rep. Carlos Gonzalez said he wrote a letter to the Massachusetts Gaming Commission to deny the sale.
He said, “It is crucial that any decision regarding the sale of the casino prioritize the residents and ensures the continuation of a positive impact that the casino MGM has had on our local economy. So we are asking them to respectfully deny any requests by MGM to sell their property or their name.”
State Rep. Bud Williams told the Day, “It’s a business decision. I understand, I get it but I just think we need to protect the city, the taxpayers, at the end of the day to make sure that whoever comes in, if they come in, that they adhere to all these safeguards.”
In a recent statement, MGM Springfield officials said they are aware of the reports of the sale and will not comment on any rumors.
