Wednesday, October 10, 2007
By William Spain, MarketWatch
CHICAGO (MarketWatch) -- MGM Mirage is taking its building spree on the road, announcing Wednesday that it plans to construct a gambling, hotel and retail complex for $4.5 billion to $5 billion on land it owns in Atlantic City.
Before the start of trading,MGM Mirage said its board approved the project, to be called the MGM Grand Atlantic City. It will located on 72 acres of land it already owns adjacent to the Borgata, the company's 50/50 joint venture with Boyd Gaming.
Plans call for three hotel towers with more than 3,000 rooms, which would make it the largest such facility in the New Jersey resort town. It would also have the largest casino floor in the state, with 5,000 slot machines, 200 table games and a poker room, along with a 1,500-seat theater, restaurants and nightclubs, a spa, a convention center and 500,000 square feet of retail space.
"Our company has carefully considered the possibilities for our landholdings in Atlantic City," said Terry Lanni, chief executive, in the announcement. "We believe the success at Borgata demonstrates the eagerness for further evolution of the nation's second-largest gaming market."
The company added that the resort will be the city's tallest building and "dominate the architectural skyline."
Assuming it gets the go-ahead from state coastal regulators, MGM Mirage intends to break ground on the project next year with an opening slated for 2012. About 60 acres of the site will be used with 12 acres reserved for "future development, which may include a residential component."
Word of the project comes as New Jersey gaming regulators continue to probe the company's Macau joint venture with businesswoman Pansy Ho. She is the daughter of Macau casino tycoon Stanley Ho, who has long been dogged by allegations his gambling halls have been involved with organized crime. If the New Jersey regulators find her an unsuitable partner, MGM Mirage could be forced to either back out of the Macau project -- which is set to open in December -- or dump its holdings in Atlantic City.
Both Nevada and Mississippi have approved the company's relationship with Ho and Lanni has publicly expressed confidence that New Jersey will eventually follow suit.
The project is apt to be nicknamed "City Center East" after the $6 billion complex that MGM Mirage is currently building on the Las Vegas Strip, a development it bills as the largest privately funded construction project in history.