{"id":306220,"date":"2024-01-10T16:46:01","date_gmt":"2024-01-10T22:46:01","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=306220"},"modified":"2024-01-11T11:38:00","modified_gmt":"2024-01-11T17:38:00","slug":"new-york-casinos-could-elevate-operators-debt-burdens","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/","title":{"rendered":"New York Casino Bidders Could Take On Big Debt if Victorious"},"content":{"rendered":"

Operators vying for New York City casino permits could take on significant debt to execute those projects if they\u2019re selected by the state.<\/p>\n

\"Seneca
New York Gov. Kathy Hochul speaks to reporters on June 7, 2023. S&P believes New York casino projects could lead to increased debt profiles for operators. (Image: AP<\/em>)<\/figcaption><\/figure>\n

That’s according to S&P Global Ratings, which in a new report, noted that the gaming companies that procure the three downstate casino licenses in New York could add leverage. That’s while their efforts to improve corporate credit metrics could be slowed.<\/p>\n

The project sizes range from $2 billion on the low end for expansions or redevelopments of existing properties to more than $5 billion for new developments. However, the leveraging impacts could be 12-18 months away,\u201d<\/strong> noted the research firm.<\/p><\/blockquote>\n

Expansions and redevelopment would be applicable to MGM Resorts International\u2019s (NYSE: MGM) Empire City Casino in Yonkers and Resorts World New York in Queens. It\u2019s widely believed that those slots-only venues will command two of the three downstate licenses.<\/a> But for now, that\u2019s just speculation.<\/p>\n

New York Casinos Expensive<\/h2>\n

New York City is one of the last untapped gaming frontiers in the U.S. State and local policymakers know as much, and they\u2019re likely to leverage that status to extract as much capital from operators for the cash-needy state as possible.<\/p>\n

Recent rumors indicate that New York could tap winning bidders for casino permits for as much as $1 billion each in licensing fees, well above the previously expected permitting cost of $500 million.<\/p>\n

\n

The $1 billion permit fee doesn\u2019t include operators\u2019 construction costs<\/a>, meaning pitches such as Las Vegas Sands\u2019 plan for a Nassau County casino hotel and Hard Rock International\u2019s pitch for a gaming venue near Citi Field in Queens could cost as much as $6 billion and $8 billion, respectively.<\/p>\n<\/div>\n

\u201cWe believe New York is unlikely to award licenses before the second half of 2024, and don’t anticipate winning bidders would initiate any material capital spending before 2025,\u201d added S&P. \u201cThese developments could take several years to complete, given the complexities of building in New York and the likely large scale of the projects.\u201d<\/p>\n

Given the current trajectory<\/a> of the New York casino bidding process, the second half of this year appears optimistic in terms of an announcement on the winning bidders.<\/p>\n

For Operators, Upside\/Downside<\/h2>\n

For the operators that emerge victorious in the quest for the three downstate licenses, New York could be a short-term pain, long-term gain proposition.<\/p>\n

\n

Contenders such as Las Vegas Sands (NYSE: LVS), MGM, and Wynn Resorts (NASDAQ: WYNN) are currently allocating capital to enhancements and new developments in other parts of the world, while Caesars Entertainment is actively reducing debt<\/a>.<\/p>\n<\/div>\n

Add multibillion-dollar tabs for New York into the mix and the winners there could see debt ratios increase and already fragile credit ratings imperiled. However, that pain could be worth it over the long term, because some industry experts believe that when the three New York City casino hotels reach maturity, those venues could generate revenue on par with, or in excess of, the entirety of the Las Vegas Strip.<\/p>\n","protected":false},"excerpt":{"rendered":"

Operators vying for New York City casino permits could take on significant debt to execute those projects if they\u2019re selected by the state. That’s according to S&P Global Ratings, which in a new report, noted that the gaming companies that procure the three downstate casino licenses in New York could add leverage. That’s while their […]<\/p>\n","protected":false},"author":46,"featured_media":297348,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10,86438],"tags":[81897,81903,86457],"acf":[],"yoast_head":"\nNew York Casinos Could Elevate Operators' Debt Burdens<\/title>\n<meta name=\"description\" content=\"New York Casino Bidders Could Take on Big Debt if Victorious.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"New York Casinos Could Elevate Operators' Debt Burdens\" \/>\n<meta property=\"og:description\" content=\"New York Casino Bidders Could Take on Big Debt if Victorious.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2024-01-10T22:46:01+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-01-11T17:38:00+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/11\/download.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/\",\"url\":\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/\",\"name\":\"New York Casinos Could Elevate Operators' Debt Burdens\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/11\/download.jpg\",\"datePublished\":\"2024-01-10T22:46:01+00:00\",\"dateModified\":\"2024-01-11T17:38:00+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"New York Casino Bidders Could Take on Big Debt if Victorious.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/new-york-casinos-could-elevate-operators-debt-burdens\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/11\/download.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/11\/download.jpg\",\"width\":1200,\"height\":800,\"caption\":\"New York Gov. 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