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Earlier this month, the Massachusetts Gaming Commission (MGC) delivered fantastic news to Encore Boston Harbor. The land intended for development, located opposite the casino, has been officially recognized as independent from the gaming establishment.
The MGC will have no oversight or jurisdiction over the new multi-use development.
What the MGC’s decision means for the new development
Legalizing gambling in Massachusetts proved to be a challenging endeavor, as it sparked controversy among the masses. Eventually, the state passed the Expanded Gaming Act, allowing for the establishment of three casinos, but not without implementing stringent regulations.
Due to the land near Encore falling outside the jurisdiction of MGC, it will not be subjected to the same stringent regulations as the casino resort. Consequently, any additional safety and security regulations will not impede the progress of the development.
Despite being heavily involved in state gambling, Massachusetts reaps several advantages from this arrangement. Scott Harshbarger, a staunch opponent of legal gambling, acknowledges that the stringent regulations and oversight help prevent the adverse consequences that have plagued other states.
“Wynn has achieved a significant victory,” Harshbarger remarked. “This success lays the groundwork for the upcoming expansion phase.”
Plans for the adjacent land
Across Broadway from Encore Boston Harbor, there will be a range of non-gaming facilities on the land. The area is intended to become an entertainment hub, featuring a concert venue, two hotels, and a parking garage.
Ownership of the land is not held directly by Wynn Resorts; instead, it is claimed by East Broadway LLC, which is a subsidiary of Wynn Resorts.
Encore officials promptly countered that the development on the adjacent land will be completely independent from the resort casino. Furthermore, they emphasized that it will not in any manner improve the gaming facility.
Despite that claim, there are those who remain doubtful. According to Craig Billings, the new CEO of Wynn Resorts, the development would contribute to the expansion of Encore Boston by alleviating parking constraints at the casino, thanks to the addition of a 2,310-space parking garage.
Are Boston theaters at risk?
The MGC’s decision has raised a notable question for some regarding its potential inclusion of a concert venue.
Massachusetts gaming regulations prevent MA casinos from constructing an entertainment facility that can accommodate between 1,000 and 3,500 individuals. This rule aims to safeguard Massachusetts theaters from being overshadowed by casino establishments.
The newly built development adjacent to Encore operates independently from the casino, thus the imposed restrictions do not extend to it. The proposed venue within the entertainment center is designed to accommodate approximately 1,800 individuals.
Wynn Resorts gets a win after several years of controversy
Encore Boston Harbor, which opened its doors in 2019, is the newest casino in Massachusetts. Thanks to its strategic location, it has become the largest and most lucrative among the state’s three casinos.
In 2014, Wynn Resorts received the gaming license for Encore. However, there were allegations of bias and conflicts of interest surrounding this decision. The Boston-area casino license was highly sought after due to its potential for immense success.
In 2018, four years after, the media exposed a series of sexual misconduct allegations against Steve Wynn, the founder and CEO of Wynn Resorts.
Stephen P. Crosby, the chairman of MGC, resigned from his position due to mounting pressure caused by allegations of bias in his stance on the veracity of the sexual misconduct claims, fueled by intense public scrutiny.
“At the time, the MGC conveyed a deep sense of sorrow, remorse, and indeed, exasperation as they tweeted on behalf of Crosby, announcing his resignation as Chair of the Massachusetts Gaming Commission. The decision was made to provide you with an optimal environment to focus on your tasks without any disturbances.”
Former executives of Wynn Resorts were suspected of concealing the allegations before they became public, resulting in a $35 million fine imposed by the MGC. Despite this, the company was allowed to retain its gaming license for Encore.
A change of pace
After investigations concluded, Matt Maddox, who was mentored by Steve Wynn, assumed the role of CEO at Wynn Resorts. It is alleged that he may be subjected to a $500,000 fine for his alleged involvement in insufficiently conducting internal investigations into the allegations.
The Encore Boston Harbor project, worth $2.6 billion, faced an unfortunate setback the following year when the casino industry experienced mandatory shutdowns due to the COVID-19 pandemic.
In spite of numerous setbacks, both the casino and its parent company managed to endure the difficulties. They implemented shrewd financial strategies to recover amidst a challenging economic climate.
One specific financial choice was made to transfer the ownership of the land on which Encore is located to the Real Estate Investment Trust, Realty Income. In order to create funds for new projects, Wynn Resorts will now rent the land back from Realty Income, thereby enabling casinos to free up capital.
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