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Station Square proposal offers millions for tourism, nothing for arena

By Mark Belko,
Tuesday, January 24, 2006
Pittsburgh Post-Gazette

With a $1 billion plan to transform Station Square into Pittsburgh’s newest “neighborhood,” Forest City Enterprises wants to redefine the terms of discussion over Pittsburgh’s coveted slot machine casino license — characterized so far by a competitor’s pledge to provide $290 million for a new arena.

The Cleveland developer is teaming with gambling power Harrah’s Entertainment to build a $512 million casino — by far, the most lavish promised — at Station Square, while at the same time promising to add 1,250 condominiums, at least 200 more hotel rooms, new restaurants, retail and other amenities to make the popular nightspot an even bigger destination, both for tourists and residents.

The proposal stands in stark contrast to another $1 billion plan advanced by Isle of Capri Casinos Inc. last month, the linchpin of which was $290 million dedicated to building a replacement for the aging Mellon Arena.

With its bid, Forest City decided to go a different route, plowing gambling revenues into a resort-style casino, plus condominiums, retail shops and restaurants in a street grid and a river esplanade rather than an arena.

Brian Ratner, executive vice president of East Coast development for Forest City, said he believes the approach provides the greatest economic return for the city and the state, not only in slots revenue through a bigger casino and its attendant amenities but also in overall development.

“We believe that the best use of our economic development dollars is what we’re showing you here today. This is the plan we think makes the most sense for Pittsburgh, and this is what we are proposing,” he said yesterday.

Mr. Ratner believes Forest City has an advantage over its three competitors for the Pittsburgh license in its partnership with Harrah’s, the largest gambling company in the country, and its long expertise in development.

“Frankly we think we’re pretty good at what we do at Forest City,” he said, adding that the company has done projects in excess of a quarter of a billion dollars in Boston, New York, Cleveland, Chicago, Los Angeles and other cities. Its Pittsburgh projects include The Mall in Robinson.

Joseph Weinert, vice president of Spectrum Gaming Group, an industry consultant, said a $512 million casino is “on the high end of what you would expect” in a state with a 54 percent tax on slots revenue. The casino would include a sports bar, a 400-seat buffet, a restaurant for fine dining, a VIP lounge and an entertainment venue.

“Clearly, Harrah’s and Forest City are trying to make a statement and it’s certainly a bold one being made by them,” he said. “I think they’re trying to blow people away. It certainly is a compelling answer to the groundswell of support to the Isle of Capri proposal.”

Pittsburgh Mayor Bob O’Connor said, however, he would have liked to have seen some funding for an arena in the proposal. Forest City officials said that should they win the license, they were willing to discuss the issue with city and county leaders as part of an alternative plan public officials are putting together.

“I look forward to seeing what they mean by that in their support of a future multipurpose facility,” Mr. O’Connor said.

Both he and Allegheny County Chief Executive Dan Onorato have said they would like to see all competitors for the city’s slots license provide some funding toward an arena. A spokesman for Mr. Onorato said the chief executive was withholding judgment until he has seen all proposals.

“The best thing for the region is if all four of these proposals came out and had money to fund construction of a new multipurpose arena,” spokesman Kevin Evanto said.

Besides a $250 million casino and arena funding, the Isle of Capri proposal, in partnership with the Penguins, includes more than $400 million in residential and office development near the current Mellon Arena. The goal is to reconnect the Hill District with Downtown. Nationwide Realty Investors, which developed the Nationwide Arena and Arena District in Columbus, would handle the redevelopment.

“We said all along that we have the best plan for the city and the region and I think that’s even more clear today,” Penguins consultant David Morehouse said.

On the North Shore, Detroit businessman Don Barden is proposing a $300 million to $350 million casino and entertainment complex near the Carnegie Science Center which would include four restaurants, a sports bar, a beer garden, a coffee shop, two nightclubs and a 1,000-seat amphitheater.

Alco Parking Corp. President Merrill Stabile is teaming with former executives of Mandalay Resort Group in Las Vegas on a proposed $385 million casino and entertainment development near PNC Park.

The state Gaming Control Board will decide, after reviewing the proposals and holding hearings, which is best for Pittsburgh.

(Mark Belko can be reached at or 412-263-1262.)

This article appeared in the Pittsburgh Post Gazette. © Pittsburgh Post Gazette

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