1.5B in casino building helps Detroit

Jul 17, 2007 5:38 AM

Seldom is Detroit, Mich., considered when investors consider gambling Meccas in the U.S. but locals are hoping the addition of $1.5 billion in casino construction will change that thinking.

The three license holders in Detroit — MGM MIRAGE, Inc. (MGM), Motor City, owned by the former Mandalay Bay Resorts, and Greektown — began operating in the late 90’s in temporary facilities.’

The law required that the companies eventually build permanent facilities. That part of the law is now being fulfilled.

MGM MIRAGE is spending $765 million for a full-service resort spa and a 17-story hotel with electronic concierges in each room. The facility will feature restaurants with celebrity chefs Wolfgang Puck and Michael Mina.

Greektown Casino is planning a smaller facility in the ethnic district of the same name. The 20-story hotel and adjacent parking garage next to its expanded casino will cost some $475 million.

MotorCity Casino, now owned by a group that is led by the Ilitch family, plans a $275 million 17-story hotel with high-end amenities.

For competition, the three Detroit casinos will face a more aggressive Casino Windsor, across the Detroit River in Canada. The property, managed by Harrah’s Entertainment Inc. (HET) will convert to Caesars Windsor with a $380 million 22-story hotel and a remodeled casino when its renovation project is completed.

Since opening the temporary casinos, the properties have marketed primarily to day-trippers and coach tours from Ontario, other parts of Michigan and neighboring states. With the new hotels, they will be attractive to high-end players who will be looking to spend more time at the entertainment centers.

The next goal will be to attract conventions to the three hotels. "Not so much the gigantic conventions," said one tourism official, "but the Michigan-based associations such as the optometrists, the gravediggers, whatever."