New York developer KG Urban Enterprises said in a Wednesday letter to the Massachusetts Gaming Commission that it would drop its bid for the construction of a $650-million casino resort in New Bedford, citing lack of sufficient finances for the completion of the project as the main reason for its decision.
Barry M. Gosin, Managing Partner of the company, wrote in the letter that due to the uncertainty that had surrounded the obtaining of viable funds for the materialization of their plan as well as the limited time they had been given, KG Urban officials could not ensure that additional funds would be found in addition to those that have already been spent.
Clearly, the letter puts an end to New Bedford’s bid for the sole casino license in Southeastern Massachusetts or Region C, as it is officially referred to. Thus, Mass Gaming & Entertainment and its plan for the establishment of a fully-fledged gambling venue in Brockton remains the only bidder.
The state gambling regulator is to officially respond to KG Urban’s letter at a special meeting, which is to take place on Thursday in Boston.
Commenting on the New York developer withdrawing its bid, New Bedford Mayor Jon Mitchell said that he is disappointed with this turn of the events, especially given the fact Mr. Gosin had made everyone believe that his company would provide the necessary funds for the construction of the property.
If it had been launched, the New Bedford casino would have created a number of jobs for residents of the area and would have annually contributed $12.5 million to the city coffers. It would have been located on the city waterfront, at the site of the former NSTAR power plant.
KG Urban has been trying to launch a gambling venue in New Bedford for more than seven years. It was this spring that the developer signed a Host Community Agreement with city officials. Under it, the company was to contribute $4.5 million in upfront payments in addition to the annual payments of $12.5 million.
In May, Mr Gosin sent a letter to the Massachusetts gaming regulator noting that Gaming and Leisure Properties Inc., a real estate investment trust based in Pennsylvania, had been signed on as primary backer of the casino plan.
According to George Leontire, one of the most vocal proponents of the project, the financial decision did not came from the Pennsylvania-based trust, but rather from KG Urban.
Apart from the financial difficulties concerning the establishment of the gaming property, Mr. Gosin also cited competition from a nearby tribal casino that could eventually be launched as a reason for their decision to abandon the New Bedford project.
On Wednesday, Cedric Cromwell, Tribal Council Chairman of the Mashpee Wampanoag Tribe, said in a statement to local media that their plan to build a casino in Taunton will most definitely benefit Southeastern Massachusetts, “the people of New Bedford” included.
