Genting has plenty of plays left
4 reasons why Miami could still work for them
The Florida legislature has snubbed Genting’s attempt at a casino in Miami, and the company has been unable to mount a winnable constitutional amendment campaign. So, the thinking goes, the only hope left for Genting Malaysia Berhad is clever lawyering, in a last-ditch effort to plant a stake in Florida.
Don’t wave good-bye to Genting yet.
Genting filed a lawsuit on April 27 that asks a judge to pre-emptively declare it lawful for Genting partner Gulfstream Park to run a casino on the Miami property for Resorts World Omni, a division of Genting. Taken as just that news nugget, observers speculate that it’s the Hail Mary. But perhaps they’re playing chess, not checkers. The consistently tight-lipped company isn’t talking, so all we have to go on are dots to connect.
News of Genting’s interest in the Florida market surfaced in 2011, when the company paid $236 million to buy 14 waterfront acres that included The Miami Herald building. When a newspaper building is sold, that’s news. When the building is sold to a company looking to change state laws and move in on long-standing pari-mutuel businesses, and that buyer is one the world’s most successful gaming companies, that’s even bigger news.
Some Genting officials have regretted the big splash they created in September 2011, unveiling futuristic hotel renderings at a press conference – that’s not how they usually roll worldwide. Politically, they made some missteps, too, including a Genting executive using the word “bulls***” in a hearing in front of the state legislature when asked if Genting would cannibalize jobs.
But a $46 billion company isn’t used to losing, and has worked through challenges across the United States. They entered the skittish Massachusetts market by partnering with an Indian tribe. They tiptoed through New York’s tax structure to run one of the nation’s most profitable casinos at Aqueduct, in the New York City borough of Queens. And by 2018, they’ll be in Las Vegas.
Here’s why they won’t be folding soon in Florida:
* They have created a gambling getaway less than an hour from Miami, at Resorts World Bimini, in the Bahamas. I could see them still building a hotel in Miami-Dade, and flying high rollers to Bimini for a day or two of big-money gambling and beach, then a couple days back in Miami-Dade for culture, fine dining, sports and sun. The company already shuttles guests in from their hotel in Bimini, including operating a suite for favored players at Miami Dolphins’ games.
* News of selling their prime Miami property might not be correct. The Miami Herald quoted an unnamed developer as saying Genting discussed selling out now – with additional buys having pushed their investment past $500 million. Would Genting sell if someone showed up with a wonderful offer? Sure. Are they actively running “for sale” ads worldwide? I don’t think so.
* Genting was close to entering Florida’s market via the front door. Last fall, as the state legislature considered renewing an exclusive agreement with the Seminole tribe for table games, the bill being discussed contained several sweeteners: a lower tax rate and blackjack for racetrack casinos and an additional gambling license available in Miami-Dade. Word in Tallahassee is that Genting was the favorite. But that bill didn’t pass. So why quit if you’ve come this close?
* Genting has a partnership with a racetrack operation that is underperforming on the casino side. While Frank Stronach has become a savior with horse racing at Gulfstream, the casino at that location has wallowed. The Hallandale Beach property touches the Miami-Dade County line and lucrative neighborhoods, such as Aventura, are only minutes from Gulfstream, with its nice mall and restaurants, quality horse racing, and underpromoted casino. In 2014, Genting and Gulfstream announced a partnership, which that April lawsuit refers to.
I acknowledge my point of view is contrarian, and that a new Miami casino would go against the wishes of racetrack casinos, the Seminoles, and the general public. (State Senator Gwen Margolis, D- Miami, notes that not one constituent has called her to request more casinos.) But Miami is simply too sexy of a market for Genting to just pack it in.
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