With vetting set to begin, a look at Philadelphia's casino applicants
CHARLES FOX / Staff Photographer
Blackjack at SugarHouse. Six groups are vying to join it as Philadelphia's second casino.
A year ago, the prospects for a second casino in Philadelphia looked grim.
Flash forward a year: Not only is the license staying put, but a robust field of six competitors has emerged to face off for the right to open another casino.
"There are more than I expected," said Dominic Pileggi, the state Senate majority leader from Chester. The number and quality of applicants is evidence of their faith that a second casino could thrive here, Pileggi said.
At the Convention Center at 9 a.m. Feb. 12, all the groups will make their first public pitches as the state's seven-member Gaming Control Board begins the vetting.
A major difference in the applicant pool from the 2006 selection, when licenses were awarded to SugarHouse Casino and Foxwoods Casino, is the popularity of the stadium district in South Philadelphia.
Three of the six proposals are for casinos along Packer Avenue.
Alan Greenberger, deputy mayor for economic development, said that although each of the groups settled on South Philadelphia for specific reasons, the area offers some basic attractions.
The stadium district would be readily accessible to casino patrons from New Jersey and the Pennsylvania suburbs, and the sites are not "embedded in residential areas," Greenberger said. The last time around, Center City and waterfront neighborhoods voiced strong opposition to casino projects.
SugarHouse eventually opened in September 2010, and the Foxwoods group lost its license because of repeated delays.
If the gaming board awards that second license reserved for Philadelphia to one of the six applicants, gaming analysts say there will be some cannibalization among the four existing casinos in the market: SugarHouse, Parx in Bensalem, Harrah's Philadelphia in Chester, and the Valley Forge Casino in King of Prussia.
From the Business Desk
Casino Revolution
Joseph Procacci, whose South Philadelphia produce business supplies one-fifth of the nation's tomatoes, is the surprise contender for the city's second gaming license.The 85-year-old founder of Procacci Bros. said his application was a last-minute decision.
Three casino-related groups paid a visit to his company headquarters at 3333 S. Front St., asking to buy some of his land. "If they liked it so much, I thought I would put in a bid myself," he said.
The project would occupy about 24 acres at South Front Street and Pattison Avenue in the crook of the Schuylkill Expressway and I-95.
Procacci has hired Joseph Canfora of the Merit Management Group in Chicago to operate the proposed $362 million casino, which would have 2,000 slot machines, 85 table games, restaurants, and a 250-room hotel.
Competitors note that though Procacci has built resort and residential properties in Naples, Fla., he has no local track record in either development or gaming, which could work against him.
Hollywood Casino Philadelphia
None of the six applicants has attracted more controversy than the proposal from one of the largest American gambling companies - Penn National Gaming Inc. - and U.S. Rep. Robert Brady, head of Philadelphia's Democratic Party.Penn National submitted plans to build the $480 million Hollywood Casino Philadelphia at 700 Packer Ave., currently home to the South Philadelphia Turf Club, adjacent to the stadium complex.
Two-thirds of the profits, according to Penn National, would go toward "city-based needs," such as the Philadelphia School District and the city's pension fund, through a nonprofit partner. The remaining third would go to Penn National.
But Penn National, based in Wyomissing, Pa., has said that if it won the license, it would seek the gaming board's approval to move the casino to the site of the former Food Distribution Center at 300 Packer Ave., a 23-acre parcel that now belongs to the Philadelphia Industrial Development Corp., or PIDC.
The bigger site, the company said, would allow it to ramp up to the maximum 5,000 slots permitted under the gaming law.
Hollywood Casino Philadelphia would open with 2,050 slot machines, 66 table games, a 15-table poker room, a parking garage, restaurants, and an entertainment venue.
When the proposal was announced, it raised myriad legal issues with city officials. Those have since been clarified, and the city will have no ownership interest, Greenberger said.
But as far as the 300 Packer Ave. site is concerned, he added, "there have been no written proposals to PIDC involving the old Food Distribution site."
Live! Hotel & Casino
The partnership behind Live! Hotel & Casino in the stadium district represents two of the Mid-Atlantic region's dominant casino operators.Greenwood Gaming & Entertainment Inc., which owns Parx in Bensalem, has teamed with Baltimore's Cordish Cos., which owns Maryland Live! Casino and developed Xfinity Live! in the South Philadelphia stadium district with Comcast-Spectacor. Each operates the highest-grossing casinos in its home state and formed Stadium Casino L.L.C. to apply for Philadelphia's second license.
"Instead of being opponents [for the license], we decided to become a force," said Bob Green, chairman of Greenwood Gaming.
With a total cost of between $425 million and $500 million, the project is planned for a 10-acre site at 900 Packer Ave., currently home to a Holiday Inn.
Live! Hotel & Casino would include a 220-room hotel with spa facilities, a gaming hall with 2,000 slot machines and 125 table games, a parking garage, restaurants, and entertainment venues.
Joseph Weinberg, president of Cordish Cos., said the casino would capitalize on the eight million annual visitors who already attend events at the stadium complex.
Given the partnership's combined financial strength, Green said, it could deliver a finished casino within 14 months of winning the license.
The site has access directly off I-95 and I-76. But traffic might be an issue - especially after a Phillies or Eagles game - and at least one gaming analyst has questioned how much revenue a casino could make from sports fans who are focused on their events and who may not gamble before or after the game.
Market East Associates has had the least to say about its project, referred to only as "Casino Philadelphia."
Developer Kenneth Goldenberg, founder of the Goldenberg Group of Blue Bell and one of the owners of the property at Eighth and Market Streets, declined to be interviewed.
The only information about the project was a brief description in the group's application to the gaming board.
The $465.9 million development would rise five stories with a rooftop garden. It would feature four levels of underground parking, four restaurants at ground level, and gaming on levels two through five. The fourth floor would include poker rooms and a buffet restaurant, with the top floor reserved for a VIP lounge.
The Market East group includes real estate investor Ira Lubert and Cozen O'Connor lawyer Michael J. Heller, two principals in the Valley Forge Casino. Other partners are many high-profile African American investors who were part of the failed 2006 Riverwalk Casino project, including entrepreneur Willie Johnson, lawyer Bernard W. Smalley Sr., and government relations consultant William R. Miller IV.
The project would likely face push-back from Chinatown, where residents have previously opposed casinos in the neighborhood over anticipated traffic congestion, but also because of the prevalence of gaming addiction among Asians.
The Provence
Philadelphia developer Bart Blatstein is thinking big.In a 263-page filing with the gaming board, he emphasized that a 123,000-square-foot casino would occupy less than 20 percent of the space of his three-block entertainment project.
Blatstein bills the Provence at Broad and Callowhill as a "resort complex" that would spur development along North Broad Street.
The historic building's iconic tower would be converted into a boutique hotel. The old newsroom of The Inquirer would become part of the casino, which would stretch over 15th Street into new construction, including rooftop shopping and dining, theaters, event space, an indoor garden, a spa, and a private swim club.
Mayor Nutter's economic team likes the idea and the synergy of an entertainment hub two blocks from the Convention Center.
But seven Gaming Control Board members in Harrisburg - not city officials - will decide on the site of Philadelphia's next casino.
Blatstein projected that in its first year, the Provence would generate gross revenue of $259 million from 3,000 slot machines and $116 million from 150 table games - less than Parx currently brings in, but more than the region's three current casinos generate.
Neighbors, meanwhile, are "deeply concerned" about traffic and parking problems that could stem from the project, said Kevin Greenberg, a lawyer for the North Broad Community Coalition, which represents more than a dozen churches, neighborhood groups, and schools.
Wynn Philadelphia
Steve Wynn is the only one promoting a waterfront casino.He has an option to build on 46 open acres in Fishtown owned by New Hope builder James Anderson.
During the last go-round in 2006, four groups pushed sites on the Delaware, with SugarHouse and Foxwoods winning out.
In 2010, Wynn was recruited by the Foxwoods team to help salvage the foundering project, but he dropped out after a week. Soon after, the gaming board took away the Foxwoods license.
What Wynn plans today for Fishtown is vastly different from what he had in mind for the much-smaller Foxwoods parcel.
Wynn Resorts, best known for casinos in Las Vegas and Macau, would spend $600 million to $800 million on a Philadelphia site. In a filing with the gaming board, the company said the casino, with 2,500 slot machines, 100 table games, and a 307-room suite hotel, would be situated in a "parklike" setting.
The property would be accessible to the public. Any construction would be set back 50 feet from the river, and the development would feature a continuous pedestrian promenade for three-quarters of a mile, with restaurants fronting the water.
Though the project would revive a long-vacant stretch of waterfront, it would be less than a mile from SugarHouse. The gaming board will have to weigh how much that would help or hurt the city's first casino.
Another issue: whether the gaming board is still smarting over Wynn's decision to drop out of the Foxwoods deal.
Contact Jennifer Lin at , jlin@phillynews.com, or follow on Twitter @j_linq.
Read more: http://www.philly.com/philly/business/20121231_With_vetting_set_to_begin__a_look_at_Philadelphia_s_casino_applicants.html#ixzz2GdCCOnNz
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