The Soloviev Group, a contender for one of New York’s coveted gaming licenses, has added the possibility for some residents to share in the project’s financial returns as developers race to sweeten deals to up their odds.
In partnership with its casino partner, Mohegan, Soloviev, the developer known for projects such as New York’s iconic Nine W. 57th St. office tower overlooking Central Park, said Wednesday it will offer eligible residents a “unique” opportunity to become “stakeholders” in its proposed Freedom Plaza gaming resort complex between 38th and 41st streets along First Avenue and south of the United Nations headquarters in Manhattan.
Up to 12% of any initial public equity raised for the proposed Freedom Plaza will be designated for residents of the city to share “both its financial returns and positive future impact,” Soloviev said.
“This is a generational opportunity for New Yorkers to have a sense of ownership and the benefits of ownership in this community project,” Michael Hershman, Soloviev's chief executive, told CoStar News in an email, adding that the decision for this offer didn’t come from community feedback.
He didn’t specify the company’s plans for public equity, which usually refers to owning shares in publicly traded companies. He said the offer will be open to all of the city’s residents and not just those who live near the site. Soloviev and Mohegan also plan to provide investment allocations to eligible New York state and city employee-related pension funds on a preferential basis relative to other institutional investors.
The capital raise would begin no earlier than 2027 if Freedom Plaza wins a casino license.
Soloviev can “win this bid on merit,” Hershman said.
Bally’s, in competing for a gaming license at Bally's Golf Links at Ferry Point in the Bronx, also has offered residents the opportunity to buy up to 10% of shares in its proposed casino, according to media reports.
The New York gaming board has said casino application licenses are due June 27, with decisions on the winning bids expected by the end of the year. Contenders have to pay $1 million in application fees to the New York State Gaming Commission, and winners have to pay a $500 million casino licensing fee up front. Up to three downstate gaming licenses are expected to be given in and around New York City.
Pumped-up bids
As competition heats up, several other proposed casino bids also have juiced their offers to secure community support, which the state has said is key to winning a gaming license.
Developers Related Cos. and Oxford Properties have more than doubled the number of housing units they propose to build as part of their casino resort complex bid on the entire western half of Hudson Yards, the largest U.S. private development.
Their updated proposal involves replacing a previously planned office tower with two residential towers.
Steve Cohen, the New York Mets owner and billionaire hedge fund investor, and his partner, Hard Rock International, added an affordable housing proposal to transform some 50 acres around the Citi Field baseball stadium in Queens.
Soloviev, for its part, previously has added affordable housing units to boost its odds at a site that it’s billed as the largest undeveloped lot in Manhattan.
Freedom Plaza’s proposal includes 513 permanently affordable housing units, about half of the 1,047 new apartments it proposed, according to its website. The project also includes nearly 5 acres of publicly accessible open space parkland and 295,000 square feet for gaming.
The resort also would include two hotels, a "destination spa" and restaurants, as well as conference and entertainment facilities.
At least two casino contenders have dropped their bids. Global casino resort operator Las Vegas Sands recently said it has abandoned its bid at Long Island’s Nassau Coliseum site, following Saks Global's withdrawal of a casino plan atop Manhattan’s iconic Saks Fifth Avenue flagship store.
Remaining contenders include the Times Square casino bid from SL Green Realty, Manhattan’s largest office landlord, and Caesars Entertainment.
Silverstein Properties plans to develop the Avenir, a hotel, casino, entertainment and residential complex spanning 1.8 million square feet near Hudson Yards.
Resorts World New York City, billed as the city’s first and only casino-hotel at Aqueduct Racetrack in Queens, also has upped its game in a $5 billion expansion plan. And developer Thor Equities has unveiled a $3 billion-plus casino, hotel and entertainment proposal for Coney Island.