Suffolk Downs proposal may deter casino rivals

The widespread perception that the Suffolk Downs casino proposal, with its strong political backers, has a lock on development rights for Eastern Massachusetts may be discouraging some casino companies from competing in what is expected to be the state’s most lucrative gambling market, specialists say.

Only one developer, Steve Wynn of Las Vegas, has stepped forward to compete with Suffolk Downs for the single license available in the eastern part of the state. That pales in comparison to the free-for-all in western Massachusetts, a smaller market that has drawn significantly more interest from casino companies.

“At this point, most people [in the industry] believe that Suffolk Downs has it locked up,” said Roger Gros, publisher of Global Gaming Business, a trade magazine that covers casino gambling. “That’s pretty much the opinion right now, that they’ve got it.”

The head of the state’s gambling commission is adamant that the process will be open and fair, and that any assumptions about Suffolk Downs are completely unfounded.

But the sense of inevitability has been enough to give pause to casino mogul Sheldon Adelson. The Boston-born chief executive of Las Vegas Sands and the 16th-richest person in the world, according to Forbes Magazine, is hesitant to bid for a casino in his native state because he believes that the fix is in for Suffolk Downs, the billionaire told Global Gaming Business for a December article.

The perception that the competition is over before it even formally begins runs contrary to the intention of the state’s new casino gambling law, which was designed to promote competition among developers in three geographic regions of the state, in order to attract the most lucrative and innovative projects.

In the western region, the law has had its intended effect.

At least five casino companies are competing, or expected to compete, for development rights to a casino in western Massachusetts. Mohegan Sun, MGM Resorts, and Ameristar have each chosen locations in that region, while Hard Rock International and Penn National Gaming are tentatively linked to western Massachusetts sites.

But in the region covering Greater Boston and Worcester, Suffolk Downs and its partner, Caesars Entertainment, currently face just the Wynn proposal, pitched for land in Foxborough owned by New England Patriots owner Robert Kraft.

“Wynn always goes against [conventional wisdom], so I wasn’t surprised to see him jump in with Kraft,” said Gros. “He dances to his own tune, that’s for sure.”

Although several landowners in the eastern region are publicly marketing their sites for casinos, no other gambling company has joined Wynn in public competition against Suffolk Downs.

The southeastern region also lacks competition at the moment, but that is by design. State law delays bidding on a casino license in the southeast until at least August to give the Mashpee Wampanoag tribe time to make progress toward winning federal approval for a tribal casino in that region. The deference to the tribe is being challenged in federal court.

The perception that Suffolk Downs is a lock in Greater Boston is longstanding, predating the legalization of casino gambling in Massachusetts.

Two days before Governor Deval Patrick signed the legislation last November, the Las Vegas Review-Journal, a close observer of the casino industry, wrote that Suffolk Downs “is all but assured the license for the lucrative Boston market,” due to support from key Massachusetts politicians and the Bay State ties of Caesars chief executive Gary Loveman PhD ’89.

Loveman lives in Wellesley, holds a doctorate from MIT, and is a former Harvard Business School professor.

The high-profile backers of Suffolk Downs include House Speaker Robert A. DeLeo, whose district hosts the racetrack, and Mayor Thomas M. Menino of Boston, a longtime friend of Suffolk Downs investor Joe O’Donnell.

Menino has been outspoken in supporting the Suffolk Downs location, and casino officials say they got the message.

1 Comment
Anonymous about 12 years ago

Why just one casino for eastern Mass.? That means it will have to be controlled by a large corporation.

They should allow neighborhood bars to install slot machines and maybe a poker table. That would help small businesses while also generating tax revenue.