The New York Times is reporting that Caesars and SL Green Realty, a well-known property owner and real-estate developer, are proposing a casino in Times Square. There is no cost estimate, but one assumes it must be large, somewhere between $2 billion and $4 billion; even a $10 billion final price would not be surprising. It is, after all, the Big Apple, the most populous city in the nation.
The media are predicting billions in tax revenue from a New York City casino and according to a Fox News report, the minimum bid will be $500 million. In a city where a one-bedroom condo costs a million dollars or more, the cost of the real estate and construction will be attention-getting. That in part explains the Caesars proposal. SL Green already owns a building in Times Square; Green is touting the ease of remodeling as a factor, suggesting its Times Square casino could be open a year or more earlier than any other proposal. It also means that Caesars would not have to buy the real estate on the open market.
Three licenses are available for the New York City region; there are a number of tentative proposals or expressions of interest: Wynn, MGM, Hard Rock, Las Vegas Sands, Bally’s, Genting, the developer who owns much of the Coney Island amusements district, and Caesars and GL Green. Wynn is partnering with the developer of Hudson Yards, Genting has 5,000 slot machines at Aqueduct Racecourse in Queens, MGM owns Empire City in Yonkers just outside the city limits. The other contenders have not announced a real estate partner or location.
The names being discussed are at present just media rumors and idle talk. No official bids or proposals have been submitted. By law, New York must open the bidding on January 6, 2023. The state has not stated specifically for how long the bidding will be open or the schedule for reviewing proposals and awarding licenses. Very little is known about the process or the criteria to be applied. It is not unlike Chicago at the same point in its process to pick a location and licensee for the Windy City. In New York City, only step one has been taken.
On October 3, the New York Gaming Commission approved three appointees to the New York state Gaming Facility Location Board, two lawyers and one public activist. One of the appointees served on a previous Location Board. None has a financial or casino background. They will be tasked with reading thousands of pages, with some detailed financial projections, then rating each and choosing the best to be licensed. On the surface, it appears that the process will be long and tainted with political implications. For the Location Board, job one will be recruiting a large and professionally diverse staff. Even with a highly competent staff, the task will be monumental.
The process should be long and difficult, given the mandate. An exclusive casino license for Manhattan is a very valuable prize. The New York City area has more than 20 million residents and the city receives 60 million visitors a year. The Times Square location would put a casino at the heart of the city’s tourism and entertainment; it is sometimes called the crossroads of the world. A casino there could expect to see a significant proportion of 80 million potential customers at least once a year.
Two of the expected bidders, Genting and MGM, might have an inside track; each already has an operating property. Genting has promised to invest as much as $4 billion to make its property a true destination resort. MGM has spent $850 million to buy Empire City and put itself in line for a license. Given its history, MGM will undoubtedly promise significant investment as part of its license proposal. The media coverage suggests those two are guaranteed a license, although the Gaming Commission says there are no guarantees. In any case, we can expect to see some eye-popping, innovative, and expensive proposals. But we can also expect to see some serious resistance from not-in-my-backyarders.
That has already started. The Broadway League, an association of Broadway theater owners and producers, has come out against the proposal. The League says a casino in Times Square would threaten the very life of Broadway and New York tourism. In their public-relations campaign, Caesars and SL Green have been out recruiting supporters; so far, they’ve signed up some small-business owners and the Actors’ Equity Association, a union that represents workers in the Broadway theaters. Every proposal will have its adversaries, but none will get as much press or engender as much emotion as the Times Square casino. It will be a show worthy of Broadway’s Great White Way.
Even if Caesars is awarded a license, the casino will not be open soon. This year, revelers will welcome 2023 without the hint of casino casting its shadow. But next year, the celebrants may toast the coming of Caesar. If you are a Caesars Rewards member with enough points, you might be able to book a room for the 2025 fireworks and if not, possibly 2026. Rewards members should be making plans to reserve a Ball Dropping Room in Times Square. It will be quite a celebration for Caesars and the casino industry. Caesar will have crossed the Hudson, and conquered New York City, and occupied Manhattan.
