The idea of a casino in Manhattan has always been the longest of longshots, but that could change, with credible support gathering around the possibility that the Covid crisis could tilt the odds.
The New York Times reports that it’s not just outside gaming companies doing the pushing either. With the legislature and the administration of Governor Andrew Cuomo staring down epic budget deficits, some serious New York City real estate interests with serious influence in Albany believe there are powerful ears willing to listen.
The reality is the pandemic’s damage hasn’t been limited to the state’s finances. Concerns are mounting about the marketability of office space now that businesses have gotten accustomed to their employees working from home. Tenants leased just 20.5 million square feet of Manhattan office space in 2020, a 64 percent decline year on year and “the lowest level experienced in at least two decades,” according to a recent report cited by the Times from real estate services firm Savills.
Now, property giants of the likes of Vornado Realty Trust and Morris Bailey, the owner of Atlantic City’s Resorts Casino Hotel, are pitching reels, wheels, cards and dice for their sizable holdings in and around Herald Square, sources told the Times.
L&L Holding Company is proposing a casino for the $2.5 billion, 46-story tower it’s building at 47th Street and Broadway whose plans include a theater and a luxury hotel.
“Times Square market is ripe for a high-end casino,” the company enthused in a presentation released in November that featured renderings of beautiful people gathered around roulette and blackjack tables and an image of Celine Dion performing before a packed house.
“Be the future,” it says.
Under the terms of a 2013 voter referendum, New York can award three downstate casino licenses beginning in 2023. Gaming interests have been pushing for years to accelerate the timetable𑁋led by Las Vegas-based MGM Resorts International, which owns the racino at Yonkers Raceway; Malaysia’s Genting Group, which owns a casino in the Catskills and the racino at Aqueduct Racetrack in Queens; and Las Vegas Sands, a giant of the pre-pandemic convention business on the Las Vegas Strip and a major player in Macau and Singapore.
They’re not alone. L&L is reported to be in talks with LVS and other operators. The Real Estate Board of New York, which represents nearly every major developer in the city, also supports speeding things up, according to the Times.
Up to now, Cuomo and legislative leaders have resisted these efforts, and neither has been a proponent of placing any of the licenses in Manhattan.
“I’m not a big fan of casinos, period,” said Manhattan’s Liz Krueger, who chairs the Senate Finance Committee.
Brad Hoylman, the senator whose district includes Times Square, said it “would be a fight to get me and a lot of other people to support a casino.”
Cuomo isn’t a fan of expanding gambling in any form. But the state is facing a budget shortfall over the next two years estimated at $60 billion, and as it would appear from his recent about-face on mobile sports betting, he might be more willing to listen than he’s been in the past.
For one thing, it’s expected the state will ask $500 million apiece for the licenses up front, not counting taxes𑁋”real money,” as pro-gaming Assemblyman Gary Pretlow told the Times.
“If I can raise a billion dollars without raising a penny in taxes, I think that’s a good deal.”
It’s the view of state Senator Joseph Addabbo, Pretlow’s counterpart in the upper house, that the licenses amount to nothing less than “gold.”
“Who wouldn’t want a gaming license in downstate New York?” he said. “The bottom line is it’s about location.”
At the same time, both are well aware that as things stand the political support is lacking.
As Pretlow put it, “Manhattan is off the map.”
The likelier course will be to convert the racinos𑁋MGM’s Empire City Casino and Genting’s Resorts World New York City𑁋to full-scale casinos with house-banked slots and live table games.
This promises to be immensely beneficial to the state in its own right, with sizable up-front license fees and at least a 10 percent tax on table revenue and up to 45 percent on machine games, based on the rates paid by the four upstate commercial casinos.
Probably a lot quicker and easier to make happen, too.
“For me, in my district, the opportunity to have full gaming would be an economic boon, not only for Yonkers, but for all of Westchester,” said Senator Shelley Mayer, who represents the county. “I’m fully on board for that.”
For the third license, Las Vegas Sands, for its part, has expressed interest in a site near Resorts World, and Pretlow told the Times he’s heard of interest in a site in Queens adjacent to Citi Field, home of Major League Baseball’s New York Mets.
Then again, this being New York, nothing involving gaming is ever quick or easy.
Genting would be likely to fight any proposal aimed at placing major competition in its backyard at Aqueduct.
There is also a lingering taint in the minds of some lawmakers surrounding the less than transparent dealings by which Genting got the Resorts World license in the first place, and some legislators want to put the licenses out for open bidding.
“We could speed up the process,” said Kruger, the Senate’s powerful Finance chair. “But the Legislature should have absolutely zero to do with the decision to decide who’s getting those awards.”
