New Bedford Casino Developer Backs Out of Project
The proposed $650 million New Bedford casino project that aimed to revive a portion of the city’s lackluster waterfront is dead.
Developer KG Urban announced on Wednesday in a letter to the Massachusetts Gaming Commission that they are backing out of the project due to financing issues. The company said to the commission that they believe the possibility of a tribal casino in the area along with planned casinos in Boston and Springfield have made it difficult for them secure proper financing.
“Given the uncertainty of obtaining viable financing for the project and the time constraints of the license application process we cannot justify investing any additional funds in the project beyond the significant amount already invested,” said KG New Bedford Vice President Barry Gossin in the letter to the commission.
Two active gaming facilities, Plainridge Park Casino in Plainville and Twin River Casino in Lincoln, Rhode Island, are less than an hour from New Bedford. The Mashpee Wampanoag tribe in Taunton has been actively pursuing a casino on their land since 2012, though the tribe was given the green light from the federal government on a casino in 2014.
The KG Urban led project that was to be managed by Foxwoods was approved by New Bedford voters on a 73-27 vote last month. The project included a lucrative mitigation package for the city and promised at least $50 million in environmental remediation to the city’s waterfront area. The annual compensation for the city included $12.5 million in mitigation packages with a lump sum of $4.5 million up front.
The decision by KG Urban to walk away from the southeast casino license project is a blow to the commission as it comes at a time when state’s implementation of the new gaming law is moving ahead at a snails pace. The MGM Springfield casino has has been pushed back another year due to highway construction. In Everett, a cloud of uncertainty hangs over the Wynn Resorts project as it faces a barrage of legal assaults from all sides.
KG Urban’s decision is an even bigger blow to New Bedford Jon Mitchell, a big proponent of casinos and the project itself.
“KG Urban’s decision to abandon the Cannon Street project is an extreme disappointment and a great shock,” said Mitchell in a statement.
The big winner in all of this though is Brockton. The City of Champions now stands alone as the lone casino license applicant in the southeast region. Brockton voters barely approved a plan to build a $650 million casino on the Brockton Fairgrounds. The project includes a mitigation package that guarantees the city a minimum of $10 million a year.