One of the four gaming operators vying for a New York City casino license abruptly withdrew its bid on the deadline day for tax rate submissions.
Key Takeaways
- MGM Resorts says “newly issued guidance” on a 15-year license was a reason for the withdrawal.
- Empire City was one of the favorites to expand its video gaming into a fully operational casino.
- There are three proposals remaining after Tuesday’s tax submission deadline.
MGM Resorts announced Tuesday that it is no longer pursuing its Empire City Casino project in Yonkers due to a change in “return expectations on the proposed $2.3-billion investment,” leaving just three bids remaining for three coveted casino licenses.
"Today, MGM Resorts made the difficult decision to withdraw its application for a commercial casino license in Yonkers, New York,” the company stated in a release.
“The newly defined competitive landscape - with four proposals clustered in a small geographic area - challenges the returns we initially anticipated from this project. Also, our proposal to renovate and expand Empire City Casino was predicated on the receipt of a 30-year commercial casino license, but based on newly issued guidance from the State of New York, we now expect to qualify for only a 15-year license.
“Taken together, these events result in a proposition that no longer aligns with our commitment to capital stewardship, nor to that of our real estate partner in Yonkers, VICI.”
Community concerns
MGM Resorts, which took over ownership of the 126-year-old Yonkers location in 2019, was one of the favorites to expand Empire City from a horse racing, slot machine, and video gaming facility to a fully-operating, live-dealer casino and entertainment complex.
The bid received a unanimous 5-0 vote from a community committee Sept. 25 to advance to the tax rate submission process, which had a 4 p.m. Tuesday deadline. The new project was expected to bring thousands of jobs to the Yonkers community. MGM was committed to spending $100 million to improve the infrastructure around the proposed facility.
Withdrawing and not obtaining a New York City casino license could cloud the future for the current gaming complex and horse track, which generates $30 million in tax revenue per year for the city.
The advisory committee passed the proposal partly because they were concerned that three other fully operating casinos could lead to an Empire City shutdown, costing the area revenue and jobs.
“The property has generated more than $5 billion for New York State education, including $1.6 billion under our ownership,” MGM Resorts stated Tuesday. “We know our decision will impact many individuals; we remain committed to operating the property in its current format and believe it will continue to enjoy success serving customers in Yonkers and the surrounding communities."
Who’s left?
The finalists for the New York City casino licenses are now Resorts World, Metropolitan Park, and Bally’s Bronx. Four other bids, including three out of the Manhattan, never made it out of the community advisory stage.
The remaining three proposals were referred to the Gaming Facility Location Board with the intent of sending in a blind submission with a tax rate based on gross gaming revenue over three years. This was based on three potential competitive scenarios, including a low, average, and high model.
The New York Gaming Commission is expected to announce up to three awarded licenses by early December so that the project proposals can move forward with plans in 2026.
