Green Light for $386M First Phase of Kansas City Casino
- Feb 18, 2010
February 18, 2010
By Barbra Murray, Contributing Editor
The path has been cleared for work to commence on a new gaming property in Kansas City, Kan., now that the Kansas Entertainment L.L.C. has received its gaming license from the Kansas Racing and Gaming Commission and approval under the Kansas Expanded Lottery Act.
Kansas Entertainment–a 50/50 joint venture involving Penn Hollywood Kansas Inc., a subsidiary of Wyomissing, Pa.-based Penn National Gaming Inc., and Kansas Speedway Development Corp., a subsidiary of Daytona, Fla.-based International Speedway Corp.–expect to kick off construction of the $386 million initial phase of the Hollywood Casino at Kansas Speedway in the second half of this year.
The Hollywood Casino will occupy 101 acres overlooking Turn 2 at the 1.5 -mile Kansas Speedway track. Phase One of the premier entertainment facility and destination resort will encompass a 100,000-square-foot casino floor, upscale food and entertainment options and structured parking accommodations. Future phases, which will be developed as the market demands, will yield a hotel and convention center, additional gaming space, and an entertainment retail district.
“This property will grow the market in Kansas City because they’re putting it on the western side of the border between Kansas and Missouri, so the area’s overall gaming experience will go up,” Jacob Oberman, director of gaming research and analysis with real estate services firm CB Richard Ellis’s Global Gaming Group, told CPE. The overall gaming experience and demand are likely to increase even more if the joint venture is successful with its petition for a second NASCAR Sprint Cup Series race.
While joint venture partner Kansas Speedway Development contributed the land for the Hollywood Casino, the two partners will share the development cost equally. Penn Hollywood, managing member of joint venture, is actually new to the endeavor, having stepped in to replace former joint venture partner The Cordish Company in early December of last year.
For Penn National, parent company of Penn Hollywood, the project is particularly suitable. “Everybody makes development decisions based on what they think the property will generate, the ROI, and Penn National already will have operating efficiencies because it has a property nearby,” Oberman noted. Penn National owns the Argosy Casino Hotel & Spa in Riverside, Mo., which is approximately 15 miles from the site of the proposed Hollywood Casino. “They’re their own new competitor; they’re protecting their original investment on the Missouri side.”
If all goes as planned, the Hollywood Casino will open its doors in the first half of 2012.