Genting is back for a piece of the US state of Florida’s lucrative gaming pie with an innovative plan for a slots-only casino on Miami’s waterfront in partnership with the state’s Gulfstream racetrack.
Resorts World Miami, as the project is called, represents a major downsizing for the Malaysian conglomerate, which failed two years ago to win legislative approval for a multibillion-dollar gambling destination at the same location, a Biscayne Bay property once owned by the Miami Herald newspaper.
The new plan calls for a four-way partnership centered on the gaming license held by Gulfstream. Genting wants to use the license to operate 2,000 machine games and off-track betting at Resorts World Miami with a portion of the revenues earmarked for thoroughbred purses at Gulfstream and a portion going to a non-profit company to benefit the other partners: Horse breeders, owners and trainers and Gulfstream would also keep some of the revenue.
It’s a “less lucrative option” than the US$3.1 billion megaresort originally sought by the company, but as Genting lobbyist Brian Ballard describes it, it’s a way into the market. “Genting, over the past couple of years, has decided to look at this with a fresh set of eyes,” he told the Herald.
“I think it’s game-changing,” said Lonny Powell, CEO of the Florida Thoroughbred Breeders and Owners Association. “This is the first partnership where the revenue stream and investment would actually go back into the horses.”
There are challenges. Pari-mutuel regulators dispute Gulfstream’s claim that its license is good in both Miami-Dade and neighboring Broward County because it owns property straddling the border between the two, and Genting will need a clarification from the Legislature or it must persuade the regulators to review their decision. Alternatively, it can go to court. But a victory there is likely to spark an array of opposing lawsuits. As a lobbyist for a competing racino at Calder Race Course said, “If they issue a permit that allows this to happen, it will draw a legal challenge. I guarantee it. This is an expansion of gambling.”
Genting, which operates the most lucrative machine gaming venue in the country in New York City under the Resorts World brand and plans to spend upwards of $4 billion on a megaresort on the Las Vegas Strip, would still like to do something bigger in Florida, according to Mr Ballard. “They’re not closing out destination resort option at all,” he said.
The end of the last decade saw Genting and Las Vegas Sands spend millions on a high-powered lobbying campaign for resort-scale casinos in South Florida, but the Legislature twice rejected the idea under pressure from Disney, the Florida Chamber of Commerce and religious groups. Mr Ballard said if lawmakers don’t approve them when they meet again this coming session after a sweeping review of the state’s gambling laws, “It’s probably not going to happen.”
Genting spent $236 million to buy the Herald site and says it still intends to build a luxury non-gaming resort and residential complex there. The decision to partner with the racing industry represents is rather more novel as it presents the company with an opportunity to appeal to a broader constituency to win the votes necessary to eventually expand gambling in the Sunshine State.
As Mr Powell said, “In Florida, we’re a $1 billion industry with tens of thousands of jobs and an economic impact that exceeds [baseball] spring training.”