Hotel Online 
News for the Hospitality Executive


 
Donald Trump Beats Out Larry Bird for last Indiana Casino
 License; $108 million Casino to be Built Next to
 French Lick Springs Resort Hotel
By Tim Evans, The Indianapolis Star
Knight Ridder/Tribune Business News

July 21, 2004 - FRENCH LICK, Ind. -- Celebrity-businessman Donald Trump landed his second Indiana casino Tuesday, beating basketball legend Larry Bird and an Indianapolis partnership for a license in Orange County.

The Indiana Gaming Commission voted 4-2 to award the contract to operate the French Lick casino -- the state's 11th and final casino -- to Trump Indiana after nearly an hour of debate, mostly over Trump's financial problems.

Commission members Marya M. Rose, of Indianapolis, and Dr. I. Maurice Ndukwu, of Chesterton, voted against Trump. However, both said later they think the company's finances will improve and that it will be able to deliver what it promised to the residents of the Springs Valley, about 120 miles southwest of Indianapolis.

Trump's $108 million proposal includes payments of $10 million to help renovate the area's two historic hotels, $5 million to local government to make needed infrastructure improvements, such as a sewer plant expansion, and annual payments of at least $1.25 million to a local economic development fund.

The casino, which would open in January 2006, is expected to employ 640 people and take in an estimated $85.3 million in gambling revenue its first year.

But it was as much Trump's reputation -- enhanced by his Emmy-nominated performance on "The Apprentice" -- as his money that appeared to help sell locals.

The vote came about two hours after the local Historic Hotel Preservation Commission voted unanimously to recommend Trump's plan for the casino, to be built next to the French Lick Springs Resort hotel.

Moments after the vote, a polka band struck up "Happy Days Are Here Again" in a ballroom adjacent to the commission meeting. Hotel officials laid out a spread of hors d'oeuvres and pizza.

Commission member Rose said she was being conservative because plans to improve the finances of Trump Hotels & Casino Resorts are not final, although company officials said a reorganization would give it a strong balance sheet this year. When the refinancing is completed, Trump will no longer be majority owner of the company but will remain as chairman of the board and a powerful figurehead, said Robert Pickus, executive vice president of Trump Hotels & Casino Resorts.

"Trump did the extra work. They got out in the community and talked to the people that are going to be impacted," said commission member Ndukwu.

Trump's other Indiana casino is in Gary. Trump Indiana is a unit of New York-based Trump Hotels & Casino Resorts, which is traded on the New York Stock Exchange.

The company is negotiating a plan that would result in an affiliate of Credit Suisse First Boston investing $400 million in Trump Hotels, which has $1.8 billion in debt. In its annual report filed with the Securities and Exchange Commission in March, Trump warned of several "risks and uncertainties," including the completion of the plan.

Robert Boykins, chief executive of Boykins Lodging, which has owned the French Lick Springs Resort since 1998, called it "a great day." He said a casino was the only possible savior for his facility and the nearby West Baden Springs Hotel, both of which flourished in the first half of the 20th century -- because of illegal gambling.

"This area died when Las Vegas legalized gambling in 1949, so it is kind of cool that it has finally come back around to this," Boykins said.

Orange County Development, the group associated with Indiana Pacers President Bird, did not make the commission's cut to the final two. Bird was not actively involved in the project but had pledged money for the Orange County Community Foundation. Commissioners gave the group low marks for its unwillingness to meet the panel halfway on some demands.

Voting in favor of Trump were Donald Raymond Vowels, of Evansville; Ann Marie Bochnowski, of Munster; Thomas F. Milcarek, of LaPorte County; and Robert Barlow, of Madison. Dale Gettelfinger, of Floyds Knobs, recused himself because he has indirect business connections with an individual tied to the Trump group.

The other losing applicant was Lost River Development, a partnership of Indianapolis-based Lauth Property Group and Merit Management. Lost River impressed commissioners but lacked the marketing prowess of Trump's casino network.

Both losing groups left without commenting.

Pickus said groundbreaking would be in the fall, with Trump turning the first shovel of dirt.

A LOOK AT THE WINNING CASINO PROPOSAL: Orange County Development, Lost River Development and Trump Indiana presented proposals for a casino for the French Lick area. Highlights of the winning proposal:

Trump Indiana:

--Key player: Donald Trump

--Casino square feet: 71,000

--Theme: French Renaissance

--Features: 90-seat entertainment lounge, deli, buffet, parking garage

--Slot machines: 1,000

--Employees: 640

--Estimated first-year gambling revenue: $85.3 million

-----To see more of The Indianapolis Star, or to subscribe to the newspaper, go to http://www.IndyStar.com.

(c) 2004, The Indianapolis Star. Distributed by Knight Ridder/Tribune Business News. For information on republishing this content, contact us at (800) 661-2511 (U.S.), (213) 237-4914 (worldwide), fax (213) 237-6515, or e-mail reprints@krtinfo.com.

 
advertisement 
To search Hotel Online data base of News and Trends Go to Hotel.OnlineSearch
Home | Welcome| Hospitality News | Classifieds| Catalogs& Pricing |
Viewpoint Forum | Ideas&Trends | Press Releases
Please contact Hotel.Onlinewith your comments and suggestions.