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Casino has plans to expand at Detroit Convention Center

Deputy Mayor Anthony Adams said Tuesday that top Detroit officials are meeting with Las Vegas casino and convention center operators to discuss the acquisition and expansion of the Cobo Center.

The Venice Group, which operates the Venice Resort and Casino and Sands Expo and Convention Center in Las Vegas, visited Detroit during the North American International Auto Show on Monday to outline its vision for a facility that includes casinos, hotels and expanded Kobo Hall to officials in Detroit, Wayne, Oakland and Markham counties.

Kilpatrick Mayor Kawame spoke with Casino Group in Washington, D.C., where he attended a U.S. mayor's meeting on Tuesday, Adams said.

Active meetings with key political and economic leaders demonstrated the seriousness of the group, and Wayne and Oakland County officials, who balked at the prospect of more public funding being used to expand the Kobo Center, immediately accepted their proposal with pleasure.

"This is a matter of a lifetime. We're not talking millions of dollars, we're talking billions of dollars here," Oakland County Executive L. Brooks Patterson said. "If the mayor doesn't take this opportunity, I underestimate him."

Wayne County Executive Secretary Robert Picano said the key to the deal is to ensure that the COBO expansion takes place without taxpayer money.

"Auto-shows generate $500 million to $700 million in revenue, and what would we do for them if a company came in and said the same thing? We're going to bend over for them," he said. "The bottom line is with retail investors, and we don't have to raise taxes to do that."

The casino group also scouted the city to meet with the Port Authority to discuss the possibility of a bond sale for the project, as well as labor groups and local bankers, and to find possible locations for the facility. Governor Jennifer Granholm was also involved in the discussions within the past few days, Granholm's spokeswoman Liz Boyd said.

Adams said the proposal has some advantages but one big drawback of not having a casino license.

"There are other groups that have come in with a lot more detail in their plans, but every group brings something to the table," Adams said. "This group has a tremendous balance sheet, but it's really premature to discuss it because they don't have a license."

Upon completion of the merger agreement between MGM and Mandalay Bay Resort, MGM Grand Detroit's casino license will be available. Mandalay Bay owns the majority of its Motor City casinos, and under federal antitrust laws, a company is not allowed to own two casinos in the city.

MGM, however, should sell to Venetian Group and agree to settle an outstanding lawsuit filed by Lake Superior Chippewa and the Lac Vieux Desert Band over Detroit's casino bidding process, Adams said.

"And then they have to get approval from the city," he said. "They are the three main obstacles, but they are not insurmountable."

Adams said the Venetian group is just one option the city is considering. Several other gambling groups have approached the city with suggestions. And city officials have not completely abandoned Kobo's plan to expand public funds.

Nevertheless, he said, "Private money transactions make sense. The less public dollars, the faster the transaction can move forward."

The assessment comes a year after Kilpatrick called for a new one-million-square-foot convention center run by local authorities. The rest of the region's political leaders said that despite the need to expand aging facilities, it was almost immediately too much for taxpayers to afford.

Kilpatrick has repeatedly said expanding the 700,000-square-foot Kobo is essential to sustaining the auto show and attracting other convention businesses to the city. Chicago's McCormick Place announced last year that it would expand to 1.2 million square feet, suggesting it could easily acquire the North American International Auto Show.

Kobo was built in 1960 and last expanded in 1989. The car show has been calling for the facility's expansion for several years. The main source of Kobo is a tax on hotels and motels in Wayne, Oakland, and McComb counties.

A spokesman for Las Vegas Sands Corp. Ron Leith neither confirmed nor denied the company's interest in developing a facility in Detroit.
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Friday, February 9, 2024
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