2023-09-27T00:00:00Z By Madeleine Knight
2023-09-26T06:00:00Z By Daniel Leon
2023-09-26T06:00:00Z By Lesley Males
2023-09-25T12:33:00Z By Niall Greene
Two proposals have emerged as front-runners in the great New York City casino chase. SL Green, Gotham’s largest commercial landlord, is teamed with Caesars Resorts and, surprisingly, rapper Jay-Z in a prospective bid to create a gaming mecca in Times Square. Related Companies hopes to kickstart construction of Hudson Yards’ western portion with a Wynn-branded casino and hotel. It’s the Big Apple’s most-watched property-world battle as the office market struggles with post-Covid fallout.
Neither developer has yet submitted a formal proposal to New York State officials, which will select one scheme in the five boroughs; the parties must first work through a protracted Q&A period. The process is likely to be drag on through the summer leading up to final submission of offers by the year-end and the winner chosen in 2024.
New York State voters approved having casinos in the state back in 2013. Several opened upstate, but the issue of opening one in New York City was always contentious. The only legal gaming facility in the five boroughs is a so-called ‘racino’ – a slots-only place in Queens. Now, governor Kathy Hochul and mayor Eric Adams want a full-scale, Las Vegas-style casino in the Big Apple.
Some elected officials and urban planners oppose having any casinos in the city, citing the potential for crime and the failures of many gaming establishments in upstate New York and in nearby Atlantic City. But many hospitality firms, labour unions and gamblers shrug off such concerns. Now, some 10 companies are vying for a licence, most of them regarded as dark-horse candidates.
Among them, Soloviev Group is pitching to develop a ‘Freedom Plaza’ complex with casino operator Mohegan on three undeveloped blocks on the East River waterfront. Thor Equities is teamed with Saratoga Casino Holdings and the Chickasaw Nation for a bid in Brooklyn’s Coney Island district.
All the applicants promise spectacular neighbourhood improvements, epic job creation and tax-revenue bonanzas. But partly because SL Green and Related are the most powerful developers and have the strongest political clout, most eyes are on their very competing, very different visions.
SL Green and Caesars announced their partnership bid early in 2022. The casino would be at 1515 Broadway, a 54-storey, 1.7m sq ft office tower between West 44th and 45th streets. The partners said their plan would be the least neighbourhood-disruptive proposal as a 250,000 sq ft casino would be installed in an existing building.
The rest of the tower would become a luxury hotel. SL Green argued its project would help to arrest a slow-but-steady erosion of Times Square’s appeal.
Battle lines over the proposal were immediately drawn between proponents including local restaurants and Actors Equity and opponents such as the Broadway League.
Then, in December 2022, SL Green and Caesars threw a wild card into the mix when they announced that Jay-Z’s Roc Nation had signed on as a partner. Exactly what role the rap artist’s company would have was unclear, although SL Green said it would be involved in bringing entertainment to other Times Square buildings although not necessarily to 1515 Broadway itself.
Related, meanwhile, is stalled in its long-range ambition to develop the 6.5-acre western side of its Hudson Yards complex, which remains an exposed, sunken train yard. Related founder Stephen M Ross previously said the western yard would be used for residential buildings, unlike the eastern portion, which is dominated by office towers and a shopping mall.
Related said last winter that its residential plan would now include a Wynn-branded casino if it were granted a licence. Then, CEO Jeff Blau revealed a new plan in May. The casino and a 1,600-room hotel to service the Jacob J Javits Convention Center across the street as well as the 250,000 sq ft casino would be housed under the roof of a single, 3m sq ft Wynn-branded skyscraper.
Perhaps more surprisingly, the proposal would include a 2m sq ft office tower as well as an apartment building, school and public park. Blau explained that even in the possibly worst office market the city has ever seen, Related’s existing Hudson Yards towers were so fully leased or sold to corporate users that it could easily fill another.
It will be fascinating to watch the drama play out. Elected officials and the business community want to assure Times Square doesn’t revert to what New Yorkers call the “bad old days” of violence and prostitution, and also to kickstart construction of Hudson Yards’ stalled western half. Fortunes are at stake at either place and for the city as a whole.
Steve Cuozzo is real estate correspondent for the New York Post