Vornado Realty Trust, a significant player among the real estate investment trusts (REITs) in New York, seems to be withdrawing from the race for a New York City casino license. Chairman and CEO Steve Roth revealed this during the third-quarter earnings conference call. The speculation over Vornado’s potential venture into the casino hotel business began nearly 10 months ago when reports hinted at their interest in a site near Madison Square Garden and Penn Station.
However, Roth seemed confident that Vornado is not vying for the license. As one of the largest commercial estate owners in New York City, the enterprise may turn to the site where the recently demolished Hotel Pennsylvania stood. Instead of a new casino hotel, they may transform the redevelopment project into a commercial space for leasing.
Among the renowned contenders for the coveted New York City-area casino permit, Vornado is the first to step out of the competition. The reasons behind their decision remain undisclosed. Yet, in the existing macroeconomic climate, large-scale commercial real estate ventures from scratch face significant hurdles, such as high-interest rates, which have several commercial real estate financiers and creditors reconsidering new projects.
Earlier rumors suggested that Neil Gary Bluhm, a billionaire financier and partner in Midwest Gaming & Entertainment, might partner with Vornado for the license bid. Bluhm also co-founded Rush Street Gaming, operator of casinos in Chicago suburbs, Philadelphia, and Pittsburgh.
While Vornado bows out, other New York REITs continue to joust in the casino license competition. SL Green collaborates with Caesars Entertainment on a Times Square gaming bid and Related Cos. with Wynn Resorts to introduce a casino hotel in Manhattan.
As the Vornado chapter closes, the one for the casino permits is still ongoing, with no certainty on when it will conclude. Some believe the decision on the winning bids won’t be announced until 2025. Turbulence engendered by a scandal involving MGM Resorts International and Resorts World adds to the drama. They were two potential winners of the three licenses, with operations of two slots-only venues in the New York City area.
Online buzz suggests Las Vegas Sands and Wynn Resorts as the potential front-runners for the New York City casino permits.
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