The developers of National Harbor announced Friday they have reached an agreement with Las Vegas giant MGM Resorts International to develop a luxury casino at the proposed gambling site on the Potomac River.
Under the agreement between the Peterson Cos. — the Virginia-based developer of National Harbor — and the gambling company, MGM would run any gambling facility the state might authorize at the sprawling Prince George's County complex, the two companies said Friday.
"The opportunity to build a destination casino resort in the National Harbor complex was extremely compelling," James J. Murren, chairman and CEO of MGM, said in statement.
Richard Clinch, who tracks gambling industry issues as director of economic development at the University of Baltimore's Jacob France Institute, said the partnership makes sense.
"MGM's a good company. It's a great location, and basically whoever goes in there is going to be given a license to print money," said Clinch, who has done research for Peterson and other gambling-related companies. "The higher the quality of the operator, the better story they can tell."
MGM is the world's largest casino operator in terms of market share, with more than $19 billion in earnings, according to Reuters Factbook. The company, which is listed on the New York Stock Exchange, controls about 40 percent of the market in Las Vegas and 8 percent in the major gambling center of Macao, on the cost of China.
In Las Vegas, MGM operates a dozen casinos, including such top-of-the-line resorts as the Bellagio, MGM Grand, ARIA, Mandalay Bay and the Mirage. It also operates casinos in Mississippi and Michigan.
The company is known for its aggressive customer loyalty program, which seeks to keep high-rollers coming back to its properties with what it describes as "one-of-a-kind experiences, insider privileges and personalized rewards for guests."
Situated on 350 acres at the foot of the Woodrow Wilson Bridge, National Harbor already boasts a half-dozen hotels, upscale stores and restaurants, and a marina anchored by the cavernous, 450,000-square-foot Gaylord National Resort & Convention Center, which opened in 2008.
James R. Karmel, a gambling industry analyst and history professor at Harford Community College, said MGM has had some issues in recent years. He noted that the company had taken big losses from its investment in Las Vegas' City Center project, which debuted just as the recession slammed that city, and that it has been involved in the money-bleeding Foxwoods casino in Connecticut as a partner with an Indian tribe.
Nevertheless, Karmel said, the likely alliance would probably give a small boost to gambling expansion proponents as they try to forge a consensus on a work group established by O'Malley to study the issue.
"It might sway some people on the committee who may be leaning one way or the another," he said.
The General Assembly has authorized five casinos around the state, but Peterson and Prince George's County Executive Rushern Baker have been pressing for a sixth site at National Harbor. They have argued that current operators could be compensated for the increased competition by allowing Las Vegas-style table games such as blackjack, poker and roulette.
That proposal has been criticized by David Cordish, CEO of the Baltimore-based company that developed the Maryland Live Casino at Arundel Mills, as a breach of what he considers a commitment to leave the Washington area in his market sphere.
The work group, which includes members from House and Senate as well as the administration, was formed by O'Malley in the hope that it could forge a consensus on whether to move forward with expanded gambling in Maryland.
The governor has said that if the panel can come up with an agreement that could win approval from both the Senate and the House, he would call a special session for July 9 to deal with the casino question. Proponents of expanded gambling want action this summer so that the broad policy question of whether to allow a sixth casino and table games can be put on the November ballot for voter approval.
If such a referendum is not put up for a vote this year, it would have to wait until 2014 — possibly delaying any project by two years.
Lawmakers have said that if voters green light an expansion, they could work out many of the details in implementing legislation next year. The Republican legislative leadership has taken the position that there should be no special session and that any action can wait until next year.
O'Malley has given the work group a deadline of Wednesday to make its recommendations. The panel is expected to meet that day.Copyright © 2015, South Florida