GAMBLING | WHAT’S NEXT?
Casinos in limbo, but the issue has changed landscape
Even with a casino-resort bill on its deathbed in the state capital this year, the battle lines have carved a new business legacy in South Florida.
Racers paddle with the Brickell skyline in the background during the Orange Bowl Paddle Championship, the largest Stand Up Paddleboarding (SUP) event on the East Coast which took place earlier today in Miami on Sunday, January 15, 2012. This is an official World Paddle Association event. PATRICK FARRELL / MIAMI HERALD STAFF
BY DOUGLAS HANKS AND ELAINE WALKER
The bill to bring casino gambling to South Florida may be dead for now, but the issue has reshaped the region’s business landscape in ways likely to last for years.
Nine months after Genting stunned Miami with its $236 million purchase of prime waterfront land and launched a divisive debate over the future of South Florida’s economy, interviews with advocates on both sides reveal much has changed.
Miami gained a major new player on its corporate roster: Genting, the Malaysian-based casino giant that now can claim one of the largest commercial real estate holdings in Miami. Business groups and community leaders picked sides on an issue that has been percolating for years, while South Florida itself quickly emerged as a potential powerhouse in the increasingly competitive casino market.
Here’s a look at the legacy — for now — of South Florida’s casino battle:
Lines finally drawn on casinos: In recent years, Las Vegas Sands and Miami Beach’s Fontainebleau pushed efforts to loosen Florida’s gambling laws to allow casinos beyond Indian lands, racetracks and jai-alai frontons. As early as 2008, aides to Boca Raton developer Art Falcone were organizing a lobbying effort to allow a casino on a downtown Miami site he owns.
But it wasn’t until Genting’s plans for a $3.8 billion resort energized the gambling debate that Miami-Dade’s business interests picked sides on the issue.
The Greater Miami Chamber of Commerce, the Latin Builders Association and Hispanic Chamber of Commerce all voted to endorse the type of casino resort Genting and Sands want to build in Miami. Frank Nero, president of the tax-funded Beacon Council, was one of the first business leaders to criticize the Genting plan —comments that attracted significant attention given his role as Miami-Dade’s top corporate recruiter.
“There were those, some fairly prominent in the business community, who were calling for my head,” Nero said.
Carnival CEO Micky Arison spoke out against downtown casinos, while real estate mogul Armando Codina and auto magnate Norman Braman helped rally the anti-casino forces.
While Codina led past efforts against casinos, Braman previously was not known as a gambling opponent. In fact, the billionaire was an investor in the Fontainebleau’s parent company at a time when it was pursuing casinos in Vegas and Miami Beach. “This was different,’’ Braman said Friday. “This was a huge expansion of Las Vegas-style gambling” in Miami. A Braman dealership sits a few blocks from the proposed site of the Genting resort.
Casinos divided the region’s political leadership, too. Miami Beach commissioners ratified their opposition to casinos in the resort city, while Miami Mayor Tomas Regalado handed Genting’s chairman the key to his city.
Andy Abboud, vice president of government relations for Las Vegas Sands Corp., said the last nine months moved Miami casinos closer to reality than in the past, but that the higher stakes also complicated the debate.
“There was a lot more money on both sides of the issue this time,” Abboud said. “That tends to make it more difficult, not less difficult.”
Miami Herald leaving Miami: The biggest change from the nine-month casino push may come in May 2013, when one of downtown Miami’s largest employers heads west. The Miami Herald last week announced plans to move its presses and 730 employees to Doral, a relocation required after Genting bought the Herald site in May and announced plans for its Resorts World Miami casino and 5,200-room hotel. Under the Genting purchase agreement, The Miami Herald will remain at its current site rent-free through May 2013.
In the young city that is Miami, the relocation qualifies as historic. The Herald moved into the waterfront headquarters in 1963, when barges were used to move massive rolls of newsprint. Few Miami businesses occupy as much commercial space as the Herald does, and it remains one of the last industrial employers downtown. Genting promises to more than make up for the exit, though, with a plan for 19,000 jobs if casino legislation passes. That would make it Miami-Dade’s largest private employer.
Downtown real estate scramble: The Herald move is the most visible element of a larger shake-up in commercial real estate brought on by Genting’s buying spree. The company also acquired the Omni hotel and office complex, which includes a Hilton hotel and a large arts school, along with other nearby tracts.
Miami-Dade’s school board headquarters put out feelers about selling its property near the Genting site. With a deep-pocketed casino giant promising a resort three times the size of South Florida’s largest hotel, land nearby suddenly became more valuable as prices skyrocketed — from $40 to $60 a square foot in early 2011, to as high as $200 a square foot in September.
“The Herald sale was so ballyhooed,’’ said Jack Lowell, a commercial broker and early Genting backer. “It was a remarkable sale.”
Las Vegas ready for a big bet on South Florida: In the wake of Genting’s purchase, Miami suddenly earned prominent mentions from top Vegas casino executives and analysts. An October report by well-respected Bernstein research firm predicted South Florida could steal 15 percent of Vegas’ gambling business, and generate as much as $3 billion in casino revenue a year.
Vegas legend Steve Wynn swooped into Miami Beach to dine with the city’s mayor, calling Miami Beach the “greatest site for a destination resort in the United States.” MGM joined Sands in scoping out potential sites, and Caesars has reportedly inked some sort of deal with Gulfstream Park in Hallandale Beach.
A new player named Genting: Genting spent a reported $500 million buying up real estate in downtown Miami, and the company said from the start it planned on being in Miami for the long haul. Its deep pockets promise to make it a local force, no matter the fate of the casino bill. The company is making local political donations, including $10,000 for Miami-Dade Mayor Carlos Gimenez’s reelection effort and $300,000 for the state Democrat and Republican parties. It also is backing a new group founded by Lowell and former Miami-Dade mayor Alex Penelas promoting casino resorts and other projects seen as economic boons.
Even critics see Genting’s investments in Miami as a proof of the company’s local staying power.
“This is Round One,’’ said Dan Gelber, the former state senator who now heads the South Florida arm of No Casinos. “These guys will simply reload with more money and bigger guns.”
Genting declined interview requests Friday, but issued a statement that said it “will continue to work with the state Legislature and the South Florida community to bring this vision into a reality.”
Read more here: http://www.miamiherald.com/2012/02/03/v-fullstory/2623745/casinos-in-limbo-but-the-issue.html#storylink=cpy