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Billionaire Neil G. Bluhm Buys Former Philadelphia Sugar Refinery;
Wants to Build $450 million Casino, Marina and Hotel Complex
By Suzette Parmley, The Philadelphia Inquirer, The Philadelphia Inquirer
Knight Ridder/Tribune Business News

Dec. 28, 2005 - The Chicago gambling company controlled by billionaire Neil G. Bluhm has purchased the former Jack Frost sugar refinery parcel on the Delaware River waterfront for its proposed $450 million slots parlor.

The company, which is pursuing the casino project under the name Sugar House Gaming, will file an application for a gambling license with the Pennsylvania Gaming Control Board today, the state-imposed deadline.

Sugar House Gaming closed on an 18-acre site at Delaware Avenue and Shackamaxon Street on Monday for its proposed slots parlor, to be called the Sugar House Casino. It bought the land from LHTW Corp., of Los Angeles. Sugar House Gaming president Greg Carlin would not disclose the purchase price.

Carlin said the casino would open with 1,500 slot machines and have five restaurants, including one for fine dining. The project would include a marina with landscaped walkways along the river for the public.

Phase II would include 1,500 more slot machines for a total of 3,000 and a 500-room hotel. A residential tower, a parking garage, or a retail and entertainment attraction could be added later if the demand is there, Carlin said.

"It will offer a much more user-friendly experience than a typical Atlantic City casino," he said. "We have 18 acres to work with. It's a good-size piece of land."

The Sugar House Casino would be built just north of the Marina View Towers, a luxury condominium project that is under construction near the Ben Franklin Bridge.

The casino's ambience would be "casual, but elegant," Carlin said. "We want it to be inviting," he said. "Elegant, but not too stuffy."

The company chose the site of the old sugar refinery over a 30-acre parcel in Fishtown that was formerly optioned by Ameristar Casinos Inc. before that company dropped its plans for a casino on Nov. 3, and a 29-acre parcel between Seventh and Lawrence Streets and Packer and Pattison Avenues that includes a warehouse used by Sysco Food Services of Philadelphia L.L.C. The Jack Frost sugar refinery was imploded in 1997.

"We think Philadelphia is a great market, and we're excited in delivering a world-class project," Carlin said.

Bluhm, once dubbed "Chicago's answer to Donald Trump," by Chicago Magazine, has a net worth of $1.4 billion, according to Forbes. He amassed his fortune in real estate as cofounder of JMB Realty Corp., which built the Chicago landmark Water Tower Place and owns the Four Seasons Hotel and the Ritz-Carlton in Chicago.

Bluhm became a founding partner of Niagara Fallsview Casino, in Niagara Falls, Ontario, in 1997. That year he also began managing the existing casino there.

The real estate magnate has assembled a high-profile and influential group of local investors for the Sugar House Casino that includes builder Daniel Keating, lawyer Richard Sprague, former state Supreme Court Justices William Lamb and Peter DePaul, auto dealer Robert Potamkin, and Jerry Johnson, president of eMoney Advisor Inc., of Conshohocken.

The addition of Bluhm's gambling company brings to three the number of developers pursuing a license to operate slots in Philadelphia.

Before Sugar House Gaming's acknowledgment earlier this month of its plans, only Planet Hollywood and Donald J. Trump had publicly announced their intentions to apply for two highly coveted gambling licenses tied to the city.

Both companies have recently gone through bankruptcy. Analysts on Wall Street had been speculating that Trump and Planet Hollywood, by virtue of being the only two known companies controlling land in Philadelphia, might win the licenses by default.

"It makes a very strong third applicant to the existing two," Marc Falcone, gambling analyst with Deutsche Bank AG, said yesterday of Bluhm's company. "They have a history of managing successful casinos.

"They're very savvy real estate investors, as well," he said. "They bring all the critical components to be a very good operator in Philadelphia."

In July 2004, Pennsylvania legalized slot-machine gambling at 14 venues. Philadelphia will play host to two slots parlors; and Pittsburgh, one. Two licenses are for stand-alone slots parlors in areas outside the state's two biggest cities, two for resorts, and the remaining seven licenses are designated for racetracks.

The Pennsylvania Gaming Control Board will award all 14 licenses in December 2006. Carlin said Sugar House would open a temporary slots facility either on a riverboat or other structure within nine months of getting its license.

Phoenix-based Aztar Corp., which owns the Tropicana casinos in Las Vegas and Atlantic City, filed its application yesterday to build a $325 million casino in Allentown.

Wyomissing-based Penn National Gaming, which submitted an application last week to operate a $212 million racetrack and slots parlor in Grantville, Pa., just outside of Harrisburg, announced yesterday that it was no longer seeking a second license to open a slots parlor in Allentown, adjacent to the Queen City Airport.

"We recently sent a letter to Allentown officials to notify them that we continue to believe it is an ideal site, but were unable to come to an agreement with a potential partner in order to proceed," Penn National spokeswoman Amanda Garber said yesterday.

ONLINE EXTRA

As the state's deadline for license applications approaches, you can read more on what various companies have proposed at http://go.philly.com/slots

Contact staff writer Suzette Parmley at 215-854-2594 or [email protected].

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Copyright (c) 2005, The Philadelphia Inquirer

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