There are 8 million people living within 20 minutes of Aqueduct," said Larry Woolf, president of Navegante Group, which is part of a bid by Aqueduct Entertainment. "This location interested a lot of folks."
New York will put 4,500 video lottery terminals at Aqueduct. The games are similar to slot machines except they are connected to a central computer system that determines the outcome. The only drawback is the tax, 70 % on gross gaming revenues. VLTs are considered lottery devices and taxed under lottery laws.
Yonkers Raceway, which is about a half-hour's drive north of New York City, runs 5,300 VLTs. Woolf said the games generate daily revenues of almost us$ 1.6 million, an average of us$ 300 per machine per day. Woolf said Navegante could beat that mark at Aqueduct.
The casino has been planned since 2001. A Buffalo, New York, group won the original bid last fall, but couldn't pay a promised us$ 370 million in upfront money to the state, causing the process to reopen.
When proposals were revealed in early May, the Buffalo group found itself bidding against a subsidiary of Wynn Resorts Ltd.; a Florida-based real estate developer working with MGM Mirage; Penn National Gaming; and Navegante's partnership.
New York Governor David Paterson is expected to select the winner in two to three months. Aqueduct, Woolf said, isn't a racino. "This is not going to be a box with slot machines," Woolf said. "This is going to be a destination resort. The idea is to attract people from outside the area. You can see JFK (New York's Kennedy Airport) from the clubhouse."
The bids are sealed. Aqueduct Entertainment's proposal, it's assumed, includes a hotel, retail and restaurants. Woolf won't say what the group would pay New York up front. The figure is somewhere in the middle of other group's offers, between us$ 75 million and us$ 200 million.
Navegante runs the Sahara, three casinos in Elko and Reno's Grand Sierra. The company would develop and operate the Aqueduct casino. The partnership includes Siemens AG, a worldwide technology firm; architectural and construction firms; and a green-building strategist.
Woolf is confident bidding against MGM Mirage, which is proposing the 350-room MGM Grand at Aqueduct; Wynn Resorts, which may have sent just a letter expressing interest; and Penn, which operates East Coast racinos. "We have formed a group with an impeccable reputation in New York," Woolf said. "We've been up against major companies before and won."