The state of Pennsylvania has dedicated the past several months to gambling industry boost and expansion beyond its wildest dreams. Despite this, one casino project which has been in the works for quite some time now is rumored to be stalling, as plans for Philadelphia’s Live! Hotel and Casino might be scrapped before they see daylight.
The rumor mill never seems to stop and there has been one particularly disturbing speculation roaming around the public space. Several sources have confirmed the thing everyone dreaded – the $600-million Live! Hotel and Casino could be among the projects to never witness actual realization. Stadium Casino, LLC. is the team behind the project and it is no secret to anyone that it has been quite active over the past several months.
Joint Venture Turns Out Trickier than Expected
Greenwood Gaming & Entertainment and The Cordish Company entered this joint arrangement called Stadium Casino in an attempt to bring to life their plans for a casino resort in South Philadelphia. The initially issued information stated that the project is going to be fully operational by 2020 when it would see its official launch. There is one significant factor which should be taken into account, and that is the element of competitiveness to this partnership.
Sources are telling us that the Philly Live! casino project is dead in the water. The two owners, Cordish and Parx, will ask permission from the PA gaming board to sell the license. No confirmation yet, but very reliable source.
— Roger Gros (@GlobalGamingBiz) October 19, 2018
When two companies enter a joint venture the way they make arrangements and achieve their goals through compromise is a crucial element. When two rival casino developers enter a joint venture, the situation becomes even more complicated, which might have been the reason for the untimely scrapping of the casino plans. The state of Pennsylvania further tightens the knot with its considerable tax rates and still expanding gaming field.
As more and more gambling offerings were confirmed, the joint venture applied for several of the essential licenses. A mandatory Category 2 license for operation cost $50 million to Stadium Casino. In addition to that, gaming expansion also brought the mini-casino opportunity. In January Stadium Casino LLC was one of the first enthusiasts making a winning bid in the second auction for a satellite casino licensing which also turned out being one of the larger ones. The Category 4 bid itself amounted to some $40,100,005 – the largest one among the four applicants.
In an attempt to further elevate the player experience, the casino developer invested $10 million in order to guarantee the future casino resort features online gaming offerings as well as brick-and-mortar ones. The only field which did not feature an application of Stadium Casino was the sports betting one, which would have resulted in an additional $10 million for a wagering permit. The developer which purchases the joint project could take care of this offering.
Potential Impact of the Sale
As a result of the sale, the two casino operators would have to take into consideration how this future casino venue would fit along their existing gaming facilities to the liking of Parx Casino, South Philly Turf Club. Greenwood Gaming & Entertainment has already secured its sports betting and online gambling licenses for the two locations which are projected to draw quite the crowd. In this sense, a third casino development featuring some of the aforementioned offerings ends up being unnecessary.
Field analysts already expressed their position regarding a potential scraping of the project, stating that a 13th Pennsylvania casino venue built in the region of Philadelphia could lead to cannibalization in the sector. Neighboring operation in Atlantic City could also be affected by the proximity of the gaming facility. And it is a tempting one, indeed, as it is located in an area associated with Philadelphia’s professional sports scene. Sports wagering would be more than attractive once operation commences.
MGM Resorts could be one of the potential buyers if the casino developers are indeed deep into negotiations for the license sale. Wagering on sports events would provide the company with yet another line for exploring the market, adding another state to its domination in Maryland, New Jersey, Massachusetts, and Ohio. Upcoming weeks are set to bring more development on the topic, as well as an official statement issued by the casino developers.
