MGM has no heart for Springfield
Five reasons I'm skeptical about casino firm's commitment
THE RECENT NONDENIAL by MGM Resorts International of the report by the Wall Street Journal that the casino company is considering a purchase of the under-construction Wynn Boston Harbor and the sale of its nearly completed Springfield casino should come as no surprise to anyone.
MGM has never had a heart for Springfield.
It all started in 2015 when MGM requested a one-year extension to open because of the I-91 viaduct construction.
Any objective observer would conclude the I-91 project would not have had an overall adverse impact on the downtown Springfield business community. Further, in the case of MGM, there were about nine other road entrances that could have been used to reach the casino without causing traffic headaches.
That was reason Number 1.
Reason Number 2 also came in 2015 when MGM “reduced the project footprint by 14 percent,” effectively taking out the “wow” factor of the casino and eliminating the 25-story glass hotel tower, thus substantially reducing the price of the project.
That reason spoke volumes in 2015.
Reason Number 3 came last year when MGM sought a commercial casino license in Bridgeport, Connecticut, at a cost of $750 million. No money for Springfield, but $750 million for Bridgeport?
By the way, MGM did have a presence in Connecticut when they teamed with Foxwoods in 2006, only to pull out of the deal in 2013.
Reason Number 4 is the request for yet another delay in the renovation of the long vacant Elm Street block, which would create 54 units of market-rate housing in a proposed $40 million mixed-use development. The extension could eventually reach 2020, as approved by the Massachusetts Gaming Commission.
That reason is especially critical. No casino should want to have a vacant building across from one of its main entrances – not to mention what it means to the overall development of downtown Springfield.
MGM may spend yet to be determined billions of dollars to purchase the Wynn project to capture the greater Boston market, the prize in Massachusetts and the northeast. More importantly, the purchase of the Wynn resort would mean MGM would have to leave Springfield, since the law says no casino operator can hold more than one license.
Why Boston, you might ask?
In their heyday, Foxwoods and Mohegan grossed about $20 billion between them.
Since the 2009 recession, they are down to about $14 billion.
MGM Springfield is estimated to gross $500 million in year three, and that was before the Connecticut legislature approved a joint venture allowing Mohegan Sun and Foxwoods to open a competing gambling facility in East Windsor. That gaming project will cost MGM an estimated $90 million annually.
So do the math and you’ll see why MGM wants to go to Boston, running a facility that will gross billions, not millions.The Massachusetts Gaming Commission should deny any MGM request to sell the Springfield license and purchase Wynn Boston Harbor. The Massachusetts legislation never intended for a bait and switch, or trade-up strategy by casino operators. Springfield, and western Massachusetts, should not be the sacrificial lamb for MGM.
Michael Albano is the former mayor of Springfield. He also served as a member of the Governor’s Council.