Potential Buyers of New York Casinos Lack Alternative Strategies
For numerous companies gunning for one of New York's three gaming permits, it's do-or-die. These firms are devoid of backup options, and it's highly unlikely they'll make any significant moves with their selected locations if they don't end up winning these licenses.
For instance, New York Mets owner Steve Cohen and real estate developer SL Green aren't talking about any alternatives if they don't clinch a casino license. Cohen is in partnership with Hard Rock International on the $8 billion Metropolitan Park project, which features a casino as part of its plan right next to Citi Field. Meanwhile, SL Green is working with Caesars Entertainment and Jay-Z on a casino hotel development in Times Square.
This lack of contingency plans echoes what industry professionals have been saying: without casinos, New York developments seem unappealing to them. Last year, Las Vegas Sands CEO Rob Goldstein and Hard Rock CEO Jim Allen told CNBC that given the massive investments needed for New York projects, it would be extremely challenging, if not impossible, to generate a decent return on investment without casinos.
Not all casino contenders are in the same boat. If MGM Resorts International's Empire City Casino and Genting's Resorts World New York in Queens don't secure traditional casino licenses, they might continue as slots-only venues.
Meanwhile, Related Cos. has the potential to push ahead with its Hudson Yards plans if it fails to win a casino hotel license. This real estate developer, partnering with Wynn Resorts, could go through with creating cost-effective residences without a gaming venue.
A plan B for Cohen and Hard Rock if State Senator Jessica Ramos (D-Queens) doesn't introduce legislation to transfer the parkland designation from Willets Point—the desired casino site—might see another legislator introducing a related bill. The Real Deal also pointed out that Silverstein Properties hasn't mentioned alternatives for its proposed casino site at 41st Street and 11th Avenue, and it could be well-suited for residential development. Similarly, Thor Equities, eyeing Coney Island for a casino, could decide to develop or sell that land if it doesn't snag one of the three permits.
The delayed decision-making process by New York regulators means a possible push into late 2025 or even early 2026 for final selections on the downstate casino licenses. This extended timeframe could benefit developers and operators by giving them more time to evaluate their bids and ponder whether or not it's wise to proceed with expensive plans that might not bear fruit in the end.
Bally's could be an example of a gaming company that may check those boxes. In 2021, the regional casino operator acquired the lease rights to the golf course formerly known as Trump Golf Links in the Bronx, aspiring to eventually build a casino hotel there. However, if their New York ambitions don't pan out, at least one big investor is advocating for them to abandon these plans.
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Source: www.casino.org
