Genting and MGM Resorts are seen as the top two candidates for two of the three casino licenses that are expected to become available in downstate New York, CBRE wrote in a note.
New York legislators are currently in final discussions on their budget and the issue of casino licenses is in focus as jobs in the state struggle to recover from the pandemic, in particular in the New York City Metropolitan area. CBRE says that a report commissioned by the state gaming regulator estimated that three full-scale integrated resorts in the area could create up to 21,500 jobs.
In theory, a moratorium on downstate casinos doesn’t expire until 2023, although CBRE said legislation tied to the budget could pave the way for licenses to be issued as early as this year.
In December, the government received more than 30 responses to its RFI.
“Current consensus puts MGM and Genting at the top of the list for two of the three potential licenses given their existing VLT racino operations already in Yonkers and Queens respectively,” the note said.
Discussions amongst legislators are ongoing when it comes to the license fee and tax rates. At present, the upfront fee has been pegged at $1billion, which might deter investors, it said. Previous discussions had put the fee at $500 million, which it said was more palatable.
The tax rate at present looks likely to be 10 percent for tables and a minimum of 45 percent for slots.
“While the slot tax rate would be a marked improvement from the average 66 percent currently paid by the state’s NYC area VLT operators, it is still higher than major competitors in neighboring jurisdictions,” it said.
Malaysia’s Genting has been ramping up its U.S. operations in recent years and is known to be positioning itself for a downstate New York bid. The company operates a VLT parlor in the city and has a 49 percent stake in Resorts World Catskills. Another electronic gaming parlor – Resorts World Hudson Valley in Orange County – is expected to open this year.
In November last year, the group was also a winner of a mobile sports betting license in the state.
The group last year also opened Resorts World Las Vegas, its first integrated resort in Nevada.