MGM Mirage Back in Big A Casino Hunt

MGM Mirage is back in the hunt to develop New York City’s only legal casino with word emerging that it has joined forces with two other entities trying to win the bidding wars for a sprawling new gambling facility at Aqueduct Racetrack.

The return of MGM – it dropped out of a casino project two years ago because of various delays by the state and New York Racing Association – heats up the already intense bidding to run the long-stalled racetrack casino.

Word of MGM involvement came from R. Donahue Peebles, a Florida-based developer who said the bid his company submitted last week to the state of New York includes the Las Vegas casino company and Harbinger Capital Partners, a Manhattan investment company.

In all, six entities placed bids to run the casino, which was first approved by the state in 2001 but suffered a series of legal, financial and political setbacks over the years. Beyond the six, Mohegan Sun offered to run the casino if the state built it, which Gov. David Paterson appears uninterested in doing.

Details about the various bids have been kept secret by the Paterson administration and the bidders. About the only information to trickle out are a few details about who is behind some of the offers.

All eyes were watching Peebles because he was also identified last week by Delaware North as one of its partners in a new bid for the casino project. But Peebles, the largest African-American real estate developer in the nation, also struck out on his own with his own set of partners.

No details were provided by Peebles about what may have been offered to the state. Delaware North last year won a contract for the casino with a $370 million offer, an amount it recently was unable to pay by the end of March when Paterson was looking to close the state’s books for the 2008 fiscal year. Paterson then put the project out for bidding again.

In a statement, Peebles said a “compelling bid’’ was offered. If successful in the bidding, the project would be called MGM Grand at Aqueduct.

The law permits up to 4,500 slot machines, but no table games. The Peebles bid also includes plans for restaurants and plans down the road for a $250-million mixed-use project featuring a 350-room hotel, conference facilities and 3,000-seat multi-purpose center.

Ken Rosevear, president of MGM Mirage Development, said, “MGM Mirage is ready to quickly resume our prior efforts and deliver on the still unrealized dream of Aqueduct. Our knowledge of and history with Aqueduct is comprehensive and dates back to the first stages of the project, and no one knows Aqueduct better than we do. Working with Peebles and Harbinger, we are confident that MGM Grand at Aqueduct will be a vibrant, first-class destination and make the residents of Queens and the state extremely proud.’’

Peebles said his team would make Aqueduct “a strong source of revenue’’ that will also include work for local and minority and women-owned businesses.

“We are confident that our proposed solution will be the best choice for Aqueduct,’’ he said in a written statement.

It was almost two years ago exactly that MGM Mirage dropped out of a deal with NYRA to develop a casino at the track. At the time, MGM Mirage chairman Terry Lanni expressed a frustration with a host of delays beyond his company’s control, including NYRA’s Chapter 11 bankruptcy filing and battles between NYRA and the state.

“We expended a lot of resources, time, and effort on the project, and regret that it did not come to fruition,’’ he said at the time.

 

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