A state panel has approved a resolution that permits Genting New York LLC, the future operators of the Aqueduct casino, to obtain a $225 million mortgage to help finance construction activities at the facility.
The New York Franchise Oversight Board approved documents sought by Genting’s lender -- which was not identified at a May 23 meeting -- that reaffirms the deal between New York state and the Malaysian-based casino group. Officials on May 24 revealed the name of the Genting lender: Commerzbank AG New York.
The five-year mortgage, as well as a $40,000 line of credit that Genting may or may not use in the months ahead, comes as the private company is looking to open the long-stalled Aqueduct facility near the end of the summer.
The agreement approved by the oversight board “recognizes the rights of the bank to come into the shoes of Genting should there be a breach of some kind during the mortgage,” Seth Agata, assistant counsel to Gov. Andrew M. Cuomo, told the panel.
The documents, the Cuomo lawyer said, protects both the bank and the state in case Genting should ever have severe enough financial problems that the loan came into default.
The state owns the land at Aqueduct and leases it to the New York Racing Association, which in turn leased a portion of the facility to Genting.
The agreement, sought by Genting’s lender, was signed May 23 by Robert Megna, chairman of the oversight panel who also serves as Cuomo’s budget director.
While there has been talk of a future expansion at Aqueduct to include hotel and other facilities beyond the VLT casino, the oversight panel made clear nothing has been decided by the new Cuomo administration. Gordon Medenica, an oversight board member and state lottery division director, said previously approved deals do not say that NYRA or Genting has right of first refusal for any future mixed-use development at Aqueduct.
“That will be decided at some point in the future,’’ Medenica said of expansion at the site.
Megna also used the May 23 meeting of the oversight board to announce that the panel will be considering NYRA’s budget at a session in the next three weeks; he said that session will also include NYRA’s recent decision -- later opposed by Cuomo -- to contract with Churchill Downs’ Oregon-based TwinSpires.com to handle telephone wagering.