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New Deadline for Foxwoods Philadelphia Casino Project Set at December 10

Posted on November 27th, 2010

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The Gaming Control Board of Pennsylvania warned Foxwoods Casino last week that the reprieve it gave the tribal casino operators in building their Philadelphia casino will be the last. The investor group tied with Foxwoods, has been given until December 10 to give the gaming board all documents that prove that a deal has been furnished to turn over control of the project to Harrah’s Entertainment, and that all these documents have been approved and signed. The board’s next meeting will be on December 16, its seven commissioners will decide whether the project’s license, which has been with Foxwoods for four years already, should be revoked or not.

With the future of the project in South Philadelphia still uncertain, the investor group and Harrah’s were not stopped in giving the commissioners artistic projections of what the planned casino would look like. According to Cyrus Pitre, chief enforcement counsel for the Pennsylvania Gaming Control Board, the December 10 deadline would require the gaming board to have documents that outline a final purchase agreement, a partnership deal that has been executed, and financing details of the project costing $275 million.

The requirements were already asked of Harrah’s and Foxwoods on the meeting that was set last Thursday. However, lawyers for both camps claimed that that despite negotiations that have occurred daily since the last meeting, the two entities have yet to produce a deal on the change of the casino’s control. According to the new developments of the deal, Harrah’s would only control 33 percent of the casino, despite developing and operating the venture. That is because Harrah’s (which has been renamed Caesar’s this week), already has a casino in Chester. Gaming laws of the state prohibits any operator from having control of more than one casino.

William Downey, an attorney for Harrah’s, has only this to comment, “We’re going to drive to get a deal wrapped up.” Downey said the casino should be constructed by the summer of 2012. The project’s second phase would include a parking garage with four stories and an additional casino space to measure 20,000 square feet. But he also claimed that the timeline for that phase is still not final. He also claimed that Harrah’s had “two highly confident letters” from financial institutions which should funnel $200 million to the company so that it would have the funding necessary to construct the casino. He also said the group will be attracting an additional $75 million in equity from partners both new and existing. He commented, “We’re aware of parties out there who are interested in getting involved in the Philadelphia market.”

Even if PEDP, the investors, succeed in persuading the board not to revoke its license, the new group still must appeal to the gaming board for permission to have the casino’s ownership changed, have facility’s original design modified, and have the new financing approved. Moreover, the project would have to be granted an extension on the deadline of the license until Dec. 31, 2012, as the current license will already be expiring in May. The gaming board’s Pitre claimed that reviewing such petitions could take them from two to three months. Mreanwhile, Dan Hajdo, a spokesman for Casino-Free Philadelphia, ome of more or less a dozen groups protesting during the meeting, said he has doubts that PEDP and Harrah’s ill meet this new December 10 deadline. He said, “The purchase agreement and financing agreement are two of the key, most complicated, and difficult documents.”

During the meeting, Harrah’s presented renderings of a “Harrah’s Horseshoe Casino,” which more or less bears a semblance to the big box design of the SugarHouse Casino, which opened in September on Delaware Avenue, Fishtown. The planned new casino would have Harrah’s expanding it in the second phase.

Ken Smukler, an adviser to the SS United States Conservancy, which proposed for the casino to be done in the historic ship, said that the design being forwarded by Harrah’s looks like a “a glorified airplane hangar with slot machines.” He said that this was not the casino the Foxwoods group promised when it got the license in 2006. He explained his criticism by saying, “Do you really think the high-end casino clientele in the western suburbs is going to be drawn to a casino in South Philadelphia because it has an Asian noodle bar, another steak house, or an Asian gaming room?”