Delaware North Off and Running on Aqueduct Gaming Expansion
- Oct 24, 2008
Delaware North, a Buffalo, N.Y.-based hospitality and food services company, has won a three-way race to build and operate a gaming and entertainment “racino” at Aqueduct Raceway in Queens, N.Y. The company will pay the state of New York $370 million upfront as a licensing fee for the project, expected to cost at least $420 million. The plan calls for the installation of about 4,500 video lottery terminals (VLTs) in a 328,000-square-foot facility that will also include restaurants, a 60,000-square-foot center and about 300 hotel rooms. Delaware North President William Bissett said the company and its partners, Aqueduct Gaming L.L.C., would spend at least $250 million to create the gaming and entertainment complex and expected to invest $170 million to maintain the facility. As reported June 26 by CPN, two other companies were vying with Delaware North to win the race for the redevelopment project at the 192-acre racetrack in the South Ozone Park section of Queens–New York City-based SL Green Realty Corp. and Australian-based Capital Play Inc. SL Green had teamed up with Hard Rock International for its proposal. Meanwhile, The Related Cos. had purchased a 20 percent stake in Capital Play to be part of that team’s bid for the Raceway project, according to a May 29 CPN report. New York State Gov. David Paterson noted in a statement that all three groups had ‘valid’ proposals, adding that all underwent significant due diligence, including “another recent review to ensure financial viability in light of the turmoil in the markets.” Paterson said that Delaware North “presents the strongest financial proposal with an upfront payment of $370 million.” He also cited the company’s success in running three similar New York racino venues: Saratoga Gaming and Raceway, Finger Lakes Gaming and Raceway and Fairgrounds Gaming and Racing. The company also operates Wheeling Island Racetrack & Gaming Center in West Virginia. Paterson said the racino will provide a steady income for the state. “Every day without a deal cost New York about $1 million in revenue,” he noted. Delaware North apparently pulled ahead in the bidding process after it agreed to make the $370 million upfront payment and also agreed to work closely with the community on its plans and to establish an employment and small business center in the area to provide information for those seeking jobs or local vendors seeking business opportunities at the new facility. The project is expected to create at least 2,000 jobs, about half construction and half permanent after the facility is completed. Bissell said the company will be creating a master plan for Aqueduct that will “prepare us for realizing the substantial development potential of Aqueduct including hotel, retail/restaurants, entertainment and residential.” Joining Delaware North in the Aqueduct Gaming partnership are: Saratoga Gaming and Raceway, New York’s first video gaming facility; The Peebles Corp., the country’s largest African-American real estate development company with a $4 billion development portfolio; and McKisssack & McKissack, the oldest African-American, women-owned professional design and construction firm in the United States. The company has been involved in more than 6,000 projects, including $50 billion in construction over the last decade.