SPRINGFIELD, MASS. — The Massachusetts Gaming Commission (MGC) has unanimously approved an agreement to award MGM Resorts International (NYSE: MGM) a license to operate a proposed resort casino in downtown Springfield. This is the first approval of a casino license in Massachusetts.
The casino and entertainment development, known as MGM Springfield, is an $800 million investment. The development will be located on approximately 14.5 acres between Union and State streets, and Columbus Avenue and Main Street. Springfield is approximately 90 miles west of Boston.
MGM plans to break ground on the casino property this summer with an anticipated opening in early 2017.
“This is a great day for Springfield, the Commonwealth of Massachusetts and MGM,” says Jim Murren, chairman and CEO of MGM Resorts. “We thank the Massachusetts Gaming Commission for its thorough vetting process and look forward to continuing our work with Springfield Mayor Domenic Sarno and other Springfield and Western Massachusetts elected officials and governmental leaders, along with residents and businesses of Springfield and the region, as we move this project forward.”
The integrated resort casino is designed as a mixed-use development project with a 25-story, 250-room hotel; 125,000 square feet of gaming space with 3,000 slot machines, 75 gaming tables, a poker room and a VIP gambling area; about 55,000 square feet of retail and restaurant space that will accommodate 15 shops and restaurants; and a multi-level parking garage. Future plans for the site include an eight-screen movie theater, bowling alley and an outdoor stage.
MGM Springfield is expected to bring 3,000 permanent jobs and 2,000 construction jobs to downtown Springfield. Boston-based Davenport Properties will develop the project in partnership with MGM.
MGM formally announced its interest in a resort casino in Springfield in August 2012. In July 2013, voters in Springfield approved MGM Springfield in a referendum vote (58 percent to 42 percent).
Following the $85 million licensing fee to MGC, MGM will make payments to the city of Springfield and surrounding communities. The global resort and casino owner will pay the city of Springfield $15 million during the construction period and $25 million annually during operations.
Possible Wildcard
All casino projects in the Commonwealth still face the threat of a ballot repeal of the casino law. Attorney General Martha Coakley ruled last year that the repeal question was unconstitutional. Following an appeal by advocates of the repeal effort, the Supreme Judicial Court is expected to decide by July if the question may appear on the November ballot.
“The city of Springfield deserves a brighter economic future. Its residents spoke loudly when they voted ‘yes’ for MGM Springfield in a July 2013 referendum,” says Michael Mathis, president of MGM Springfield. “A successful repeal would mean the loss of good jobs, new economic development and a needed revenue stream. It would also eliminate the opportunity to recapture billions of dollars currently lost to neighboring states. MGM is ready to help the Commonwealth achieve these worthy goals.”
MGM’s stock price closed Friday at $24.91 per share, up from $14.94 per share a year ago.
— John Nelson