MGM Resorts Drops Massachusetts Casino Plan for New Site
MGM Resorts International (MGM) dropped out of a casino project in Brimfield, Massachusetts, and will seek an alternative site in the western part of the state.
“The unique nature of MGM’s plans for an all-inclusive world-class resort on the Brimfield site, and our growing understanding of the needed scope for its infrastructure, simply do not allow us to pursue the comprehensive MGM resort originally envisioned here,” Bill Hornbuckle, MGM’s Chief Marketing Officer, said yesterday in a statement.
Massachusetts has drawn interest from some the nation’s largest gambling companies since Governor Deval Patrick signed legislation in November allowing for three destination resorts, one each in separate regions of the state. An additional license for a slot-machine facility is also planned.
Wynn Resorts Ltd (WYNN) has proposed a casino in Foxborough, 30 miles (48 kilometers) south of Boston, while Caesars Entertainment Corp. hopes to develop at the Suffolk Downs horse track north of the state’s largest city. Connecticut tribal casino operator Mohegan Sun is pursuing a resort in Palmer, in the western part of the state, as is Las Vegas-based Ameristar Casinos Inc. (ASCA), which in January paid $16 million for a 41-acre site in Springfield.
A five-member gaming commission will oversee the licensing process, which involves initial fees of at least $85 million and a 25 percent share of casino revenue for the state. The licensing fee for the slot facility would be at least $25 million, with the state taking 40 percent of revenue and horse tracks receiving an additional 9 percent.
MGM’s withdrawal, reported earlier by the Boston Globe, doesn’t mean an end to the proposed casino in Brimfield. The company’s former partner, Rolling Hills Realty Trust, will continue to develop that site, David Callahan, a principal in the trust, said in a separate statement.
MGM fell 0.3 percent to $14.50 yesterday in New York. The shares have gained 17 percent this year.
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