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Commercial real estate

August 6, 2008

Steeled for slots

Bethlehem casino rising for 2009 debut

BETHLEHEM – The Rat Pack, the late, legendary denizens of the Sands casino in Las Vegas, won’t make it to the opening of Sands Casino Resort Bethlehem next June, but Carbon County gamblers might. While they’re likely to be a small fraction of overall business, those patrons will be wooed from the south by the Sands and from the north by Mohegan Sun at Pocono Downs as two experienced casino operators strive to keep their slot machines humming.

Las Vegas Sands Corp. invited the media last Saturday to tour the site of its only venture into Pennsylvania gambling. Just five months after groundbreaking, the steel frames of a gambling hall, a 300-room hotel, a parking garage and a 200,000-square-foot retail complex are rising along the Lehigh River, at one end of 126 acres of the former Bethlehem Steelworks. A huge ore crane, once used to scoop up iron ore and dump it into rail cars for transport to the massive furnaces at the other end of the site, has been sandblasted and painted jet black, ready to serve as a signboard.

The four 20-story-tall furnaces, which could easily have sprung from a mad scientist’s imagination, will remain as will the “gas-blowing engine house,” where 14 locomotive-sized pumps injected compressed air to make the furnace fires burn hotter.

“It’s a piece of our industrial history that we don’t want to let go,” said Sands Bethlehem President Robert DeSalvio.

Sands is collaborating with several nonprofit organizations to create a varied entertainment complex that will include the National Museum of Industrial History, performing arts and educational venues and a new studio for PBS television station Channel 39. The furnaces, which will be lighted at night, will serve as a backdrop for the television studio and the arts spaces. They played a similar role last month, when backgrounds for the upcoming “Transformers 2” movie were shot there.

The Sands property is a small portion of the 1,800-acre brownfield that is being reclaimed and developed for residential, commercial and industrial uses. Mayor John Callahan said it is the largest brownfield in the United States and covers one-fifth of the city’s area.

The casino will open with 3,000 slot machines, DeSalvio said, with another 2,000 waiting in the wings for the expiration of a state-mandated six-month waiting period before they can go into operation. A false wall will separate the two gambling areas until December 2009.

The cost of the project was estimated at $800 million in November 2007, up from an initial estimate of $637 million. Mohegan Sun at Pocono Downs absorbed similar increases, with the permanent casino that opened July 17 costing $208 million compared to an estimated $150 million when it was announced three years ago.

Downs chief executive Robert “Bobby” Soper knows and respects his soon-to-be competitor and got to know DeSalvio when they worked at rival casinos in Connecticut.

“Sands is a first-class organization and will build a first-class facility. We anticipate a small impact,” Soper said.

DOWNS GAMBLING LEVELS OFF

Weekly slot machine gambling slipped back last week to $50.2 million at Mohegan Sun at Pocono Downs, from nearly $54 million in the first full week for the new casino building. “It’s leveled off like we anticipated,” said Downs chief executive Bobby Soper.

Mount Airy Casino Resort held steady at about $47 million in wagers for the week that ended Aug. 3.

Mohegan Sun at Pocono Downs’ hold was $4.8 million after paying out 90.4 percent of wagers to jackpot winners. Mount Airy paid out 92.2 percent, retaining $3.7 million in revenue.

Ron Bartizek, Times Leader business editor, may be reached at 970-7157.








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