Canada’s biggest casino operator Gateway Casinos & Entertainment has advised London city hall and the Western Fair District to lower lease payments or sell the land, so that the operator can realize its project to expand the slot-only gambling venue at the (Western) fairgrounds. The company announced that a decreased ground-lease rental rate is to significantly cut the costs of the operator and the operator will be able to invest more in the casino project.
Gateway added that reducing the rent is also in the interest of the city of London, as it gets a fair share of the revenue. And when the industry booms, tax revenue jumps. Councillor Phil Squire expressed his readiness to consider the proposal supposing that the operator provides more detail-oriented information and accurate numbers.
Yesterday, Gateway spokesperson Rob Mitchell shared that the operator’s priority is to expand the gambling venue at Western Fair District, but the overpriced rent may force Gateway to abandon its plan. The slot-only venue expansion has been put $140 million price tag. The operator announced its interest in building a full-fledged casino, which is to be 3 times bigger than the existing one.
Mr. Mitchell hinted that the operator does not exclude any other options in the city, but he refrained from providing any more details. He said that the expansion of the casino is also to decrease the unemployment rate. At present, Western Fair District employs 300 people, but the number is expected to increase up to 1,000. Last but not least, the expansion of the gambling venue is to capitalize on the opportunity to attract people with various interests and thus boost multiple industries and the overall economy.
Today, city officials met behind closed doors and discussed the lease the city has with Western Fair. Currently, OLG has an agreement with London city hall and Western Fair District to pay approximately $6 million a year. The deal expires in 2020 and Gateway is seeking to renegotiate the terms of the deal, emphasizing on the ground-lease rental rates. It is interesting to mention that the land is jointly owned by the city and Western Fair.
City Official Wants to Hear the Operator’s Proposal
Councillor Phil Squire asked from the operator to present more detailed information and particular numbers. He announced that his stance on the matter is neutral and he wants to support only the option, which is in the city’s best interest. Consequently, he is to estimate if the decrease of the rent is to bring more economic benefits and higher revenues to the city. Mr. Squire added that the rental rate might be viewed as reasonable, having in mind the specific nature of the casino.
He also asked the casino operator if it is to contribute to the problem gambling treatment in the city. At this moment, Coun. Squire did not give a green light to the casino expansion, as this is not the first time, in which someone presents a half-baked building project.
