ALTHOUGH IT HAS MADE A NEARLY $1 BILLION INVESTMENT IN ITS
SPRINGFIELD PROPERTY, THERE'S BEEN BUZZ THIS MONTH THAT MGM
MIGHT HAVE ITS EYE ON ANOTHER CASINO IN THE STATE, WYNN BOSTON
HARBOR IN EVERETT.
ALTHOUGH THE PROJECT IS STILL UNDER CONSTRUCTION, THE WYNN
COMPANY HAS SIGNALED IT MAY SELL THE PROJECT.
MEANWHILE, MGM SPRINGFIELD LEADERS HAVE SAID THEY ARE
COMMITTED TO ITS PROJECT IN THE CITY.
BUT WHAT WOULD BE REQUIRED FOR IT TO FOLD?
ROB RIZZUTO OF MASSLIVE AND THE REPUBLICAN DISCUSSIONED WHAT IT
WOULD TAKE.
>> PERFORM THEY WERE TO REACH A DEAL TO PURCHASE THE WYNN BOSTON
HARBOR PROPERTY, NAY WOULD ONLY BE ABLE TO HAVE, UNDER CURRENT
LAW, HAVE ONE CASINO LICENSE IN MASSACHUSETTS.
>> WHICH THEY CURRENTLY HAVE HERE IN SPRINGFIELD.
>> YES, WELL OVER A BILLION INVESTED OVERALL IN ALL THE
MONEY THEY'VE SPENT TO THIS POINT.
BUT THEY WOULD HAVE TO SELL ONE OF THE LICENSES.
SO YOU CAN ONLY HAVE ONE, AND I DON'T SEE THE STATE CHANGING THE
LAW TO ACCOMMODATE A CASINO GIANT TAKING OVER TWO CASINOS IN
THE STATE.
>> BUT THEY HAVE A HOST AGREEMENT WITH THE CITY OF
SPRINGFIELD THAT CONNECTS THEM TO THIS PROJECT.
SO IF THEY WERE ABLE TO SELL THE LICENSE, AND WE'LL DIG INTO THAT
LATER, WHAT HAPPENS THEN TO THE HOST AGREEMENT?
>> WELL, THE HOST COMMUNITY AGREEMENT, TO THE BEST OF MY
KNOWLEDGE, IT'S A STANDARD LEGAL DOCUMENT, IT'S BETWEEN TWO
PARTIES, MGM AND THE CITY OF SPRINGFIELD.
BUT THERE'S PROTECTIONS IN THERE THAT BASICALLY SPECIFY, IN THIS
CASE MGM, THE OWNING COMPANY, HAS TO MAKE CERTAIN ANNUAL
PAYMENTS, SOME OF THEM ARE ADJUSTABLE, OTHERS ARE FIXED.
IT HAS TO HAVE CERTAIN HIRING PRACTICES, YOU KNOW, THIS WHOLE
CAVEAT OF DIFFERENT CONDITIONS THAT WERE PLACED ON THEM
RECEIVING THE LICENSE.
THERE'S ALSO A LITTLE NOTE IN THERE THAT'S BEEN UNREPORTED AS
OF YET, BUT IT STATES THAT NEITHER MGM NOR ANY 5% OR MORE
STAKE HOLDER IN THE PROJECT CAN TRANSFER THE LICENSE WITHOUT
ACTUAL APPROVAL FROM THE CITY, WHICH IS REALLY INTERESTING IF
YOU THINK ABOUT IT.
>> BECAUSE THAT WOULD TAKE SOME SERIOUS WHEELING AND DEALING, I
WOULD IMAGINE, FOR THE MAYOR OR COMMUNITY DEVELOPMENT, ET
CETERA, TO SIGN OFF ON THAT.
>> ABSOLUTELY.
I MEAN, THERE WOULD HAVE TO MAKE SENSE FOR THEM.
IT'S A CLAUSE THAT'S IN THERE, YOU KNOW, WHETHER MGM OR THE
CITY PUT IT IN THERE, IT'S VERY INTELLIGENT.
YOU KNOW, YOU CAN'T REALLY FORESEE SOMETHING LIKE WHAT'S
BEING TALKED ABOUT NOW ACTUALLY HAPPENING, BUT PERHAPS SOMEBODY
DID.
>> AND THERE'S BEEN A TON OF BUZZ ABOUT THIS, THERE'S BEEN
SOME GAMING INDUSTRY INSIDERS WHO HAVE SAID THAT, AND THIS WAS
IN MASSLIVE, THAT MGM SPRINGFIELD WAS A GREAT FIT FOR
MGM WHEN THE LICENSE WAS AWARDED IN 2014, BUT MGM IS A VASTLY
DIFFERENT COMPANY TODAY.
HOW HAS MGM CHANGED IN THE LAST FOUR YEARS?
>> IT'S GROWN, RIDICULOUSLY.
THEY SPLIT PART OF THEIR BUSINESS OFF INTO A REAL ESTATE
INVESTMENT TRUST, WHICH HAS BEEN PRETTY SUCCESSFUL AS WELL.
THEY HAVE REALLY GROWN THEIR PRESENCE ON THE EAST COAST.
THEY OPENED THE MGM NATIONAL HARBOR PROJECT IN MARYLAND RIGHT
OUTSIDE OF D.C.
THEY RECLAIM ED THEIR STAKE IN A ATLANTIC CITY CASINO.
THEY HAVE GROWN EXPONENTIALLY SINCE THEY WERE ATTEMPTING TO
GET THIS LICENSE.
SO THEIR PLACE IS LIKE THE NUMBER ONE ENTERTAINMENT CASINO
GIANT ON EARTH, IT'S REALLY, REALLY SOLID AT THIS POINT.
>> WHAT MGM OFFICIALS HAVE SAID HERE IS THAT THEY'RE COMMITTED
TO THE SPRINGFIELD PROJECT AT THIS POINT.
BUT IF, AS INDUSTRY INSIDERS SAY IS ACTUALLY HAPPENING, ACCORDING
TO THE REPORT IN MASSLIVE, THERE'S DISCUSSIONS LOOKING INTO
WHETHER OR NOT THEY COULD ACTUALLY ACQUIRE THIS PROPERTY
IN BOSTON.
IT WOULD MEAN SELLING A LICENSE HERE, AS YOU SAID.
AND LET'S LOOK AT THE TOP THREE CONTENDERS FOR THAT, AS ALSO
REPORTED IN MASSLIVE.
MOHEGAN SUN IS NOT TOO FAR AWAY.
OF THE THREE ON THE TABLE, IS THERE ANY THAT YOU THINK WOULD
BE MORE LIKELY TO GO FOR THE LICENSE OR TO BE ABLE TO AFFORD
IT?
>> THAT'S A COMPLICATION AS WELL.
I THINK MOST LIKELY IT WOULD BE MOHEGAN.
AS OF RIGHT NOW THEY ARE WORKING TO GET THE EAST WINDSOR, THE
SMALL CASINO AS A BUFFER BETWEEN BASICALLY THE WEALTHY WEST
HARTFORD AREA AND SPRINGFIELD.
>> TO STOP PEOPLE COMING HERE, THEY WANT TO KEEP IT IN
CONNECTICUT.
>> EXACTLY.
LOOKING AT THE CONVENIENCE GAMING THEORY THAT PEOPLE IF
THEY'RE GOING TO GAMBLE ARE GOING TO GO TO THE NEAREST
PLACE, THEY DON'T CARE ABOUT THE GLITZ.
THERE'S COMPETING THEORIES ABOUT WHETHER THAT WILL WORK.
BUT MOHEGAN IS FOCUSING ON GETTING THAT PUSH ED THROUGH.
BUT LOOKING AT THE SPRINGFIELD LICENSE, I THINK MOHEGAN IS THE
MOST LIKELY CONTENDER.
>> WHAT ABOUT PENN NATIONAL?
>> THEY WERE IN COMPETITION WITH MGM FOR THE SPRINGFIELD CASINO
LICENSE, THEY HAD A PLAN, AND WHERE THEIR REPUBLICAN NEWSPAPER
OFFICES ARE TO REDEVELOP THAT LAND AND HAVE A CASINO.
>> WOULD HAVE BEEN A BIG CHANGE FOR YOU GUYS.
>> YES, BUT THEY'RE PRETTY WELL ESTABLISHED IN PLAINVILLE, THEY
HAVE A SLOTS PARLOR.
I'VE HEARD THAT FLOATED, BUT I THINK THEY'RE COMFORTABLE WHERE
THEY ARE.
>> BECAUSE NAY WOULD HAVE TO SELL THE SLOTS AND THAT WOULD BE
A LOT OF SHUFFLING AROUND FOR THEM?
>> YES.
AND SINCE THEY AROUND WARDED THE SLOTS LICENSE, THEY'VE --
WHETHER THEY'D BE INTERESTED IN COMING BACK TO SPRINGFIELD WHEN
THEY ALREADY HAVE A WELL ESTABLISHED BUSINESS IN
MASSACHUSETTS IS QUESTIONABLE.
>> SPEAKING OF PROFITS, HOW IS IT THAT MGM WOULD BE WILLING TO,
CONCEIVABLY WHAT WOULD THEY DO, TAKE A LOSS HERE IN ORDER TO
OPEN UP A CASINO IN BOSTON?
WHY WOULD THAT BE WORTH IT FOR THEM?
>> BECAUSE THE NET GAINS NAY COULD GET BASED OFF THE BOSTON
MARKET WOULD BE DOUBLE DIGIT OVER GROSS GAMING REVENUE AS FAR
AS WHAT THEY COULD ANTICIPATE HERE.
IT'S A BIGGER MARKET, A LOT MORE MONEY OUT THERE, A LOT MORE
PEOPLE.
AS FAR AS BEING A COMPANY LOOKING AT PROFITS, LOOKING AT
MONEY, YOU COULD TAKE A HALF A BILLION DOLLAR LOSS HERE ON A
POTENTIAL SALE MAYBE, AND MAKE THAT UP IN A RELATIVELY SHORT
AMOUNT OF TIME IN THE BOSTON MARKET.
SO IT COULD BE SOMETHING THAT WAS WRITTEN OFF AND THEN YOU
FOCUS ELSEWHERE, DOUBLE DOWN ON YOUR EFFORTS AND MAKE THAT
MONEY.
>> NICE CONNECTION, DOUBLE DOWN, I GOT THAT.
WHEN YOU LOOK AT THE HOST COMMUNITY AGREEMENT AGAIN,
ENTERTAINMENT WAS A HUGE PIECE, AS I UNDERSTAND IT, OF THAT
DOCUMENT.
THEY HAVE SOME SERIOUS OBLIGATIONS, WHETHER IT'S
FIVE-YEAR COMMITMENT TO BRINGING IN EVENTS TO MASS MUTUAL, THE
ICE SKATING RINK, NAY HAVE TO MAINTAIN THAT OVER A NUMBER OF
YEARS.
THAT'S A BIG PIECE OF THIS TOO, RIGHT?
>> IT IS.
IN THE HOST COMMUNITY AGREEMENT, MGM AGREED TOCOPROMOTE,I THINK
IT'S FOUR SHOWS AT THE MASS MUTUAL CENTER, THREE AT SYMPHONY
HALL, AND THREE AT CITY STAGE, EACH YEAR, FOR AT LEAST FIVE
YEARS AFTER OPENING.
SO LET'S SAY THEY HOO HYPOTHETICALLY SELL THE LICENSE
AND THIS OTHER CASINO COMPANIES COMES IN, YOU COULD HONOR THOSE
SAME, YOU COULD HONOR THE LOGISTICS OF WHAT'S IN THE
AGREEMENT, BUT YOU MIGHT NOT DO WITH IT THE SAME, YOU KNOW,
LEVEL OF OOMPF THAT MGM WILL PUT INTO IT.
>> MAYBE YOU WOULDN'T HAVE THE BUYING POWER THAT MGM WOULD.
>> THE INCENTIVE TO SPEND MONEY OUTSIDE OF YOUR OWN COMPLEX AS
PART OF A PLAN TO UPLIFT THE CITY.
I COULD MEET MY ONLY FOR THOSE VENUES AND ACTS, BUT MAYBE IT
WILL BE SOMETHING THAT NOBODY IS INTERESTED IN GOING TO SEE.
IF THAT'S THE CASE, THERE'S NO POSITIVE UPLIFT TO THE GREATER
DOWNTOWN COMMUNITY AS FAR AS ENTERTAINMENT IS CONCERNED.
SO I COULD MEET THE OBLIGATION, BUT IF I DON'T REALLY CARE,
THAT'S A POTENTIAL PIT FALL.
>> SO THIS POTENTIAL, WHETHER OR NOT MGM WILL STAY HERE IN
SPRINGFIELD, WHICH AGAIN THEY HAVE SAID THEY ARE COMMITTED TO
STAYING HERE IN SPRINGFIELD, BUT A LOT PEOPLE IN THE GAMING
COMMUNITY ARE BUZZING ABOUT THE POTENTIAL THIS WOULD MEAN FOR
THE MGM COMPANY TO MAKE THIS LEAP TO BOSTON.
ARE WE HEARING FROM EITHER THE MAYOR OR THE COMMUNITY
DEVELOPMENT OFFICE?
ARE THEY SWEATING A LITTLE BIT WITH THIS POTENTIAL?
>> I THINK THEY ARE.
YOU KNOW, BASICALLY THE MAYOR HAS COME OUT AND SAID THAT MGM'S
EXECS HAVE SAID WE ARE COMMITTED TO SPRINGFIELD, OR THEY'RE
COMMITTED TO A SUCCESSFUL GRAND OPENING HERE AND MAKING GOOD ON
ALL THEIR COMMITMENTS.
THEY'VE BEEN HERE FOR QUITE A LONG TIME NOW, IT'S BEEN A
NUMBER OF YEARS THAT IT'S GONE BY RELATIVELY QUICKLY.
BUT THEY ARE INVESTED IN THE COMMUNITY.
BUT AT THE END OF THE DAY, BUSINESS IS BUSINESS.
>> VERY INTERESTING TO SEE WHO IS PLAYING WHAT HAND AND HOW.
>> IT IS.
IT'S POLITICS, ENTERTAINMENT AND TV, IT'S ALL WRAPPED INTO ONE
AND IT'S OUR DAILY LIFE HERE IN THE GREAT CITY OF SPRINGFIELD.
>> THANKS FOR THE INSIGHT, ROB.
>> THANK YOU.