When Rushern L. Baker III, Prince George’s county executive, announced he wanted a billion-dollar casino built on the banks of the Potomac River, he wasn’t quite sure what he was getting into.
Baker (D) had opposed slots during a decade as a Maryland state delegate and was taking a considerable political risk as the biggest cheerleader for bringing gaming to Prince George’s. His views had changed in the 14 months since becoming county executive, and he saw a “high-end” destination much like what’s available in Las Vegas as a risk worth taking: It would help him expand the county’s tax base, keep dollars from county gamblers at home, and draw tourism and economic development.
“I didn’t know what a billion-dollar casino looked like,” Baker said in an interview last week . “But I knew a billion dollars was a lot of money.”
Anyone willing to make that kind of investment would not be building a “slots barn.” It would be a resort with upscale restaurants, boutiques and an exclusive entertainment experience. There were some doubters, but soon National Harbor developer Milt Peterson came on board, and MGM chief executive Jim Murren joined in an arduous and expensive campaign to bring the gaming resort to the Washington region.
When the glass doors at the $1.4 billion MGM National Harbor casino open to the public Thursday night, visitors will step into a slice of Las Vegas at the doorstep of the nation’s capital and into a monument to the county’s continuing progress.
The size of five city blocks, the resort was strategically built to be the first landmark people see upon crossing the Woodrow Wilson Bridge into Maryland: Its architects put it on a pedestal structure with its glass tower capturing views from the politically iconic Capital Beltway. Those involved in the casino negotiations say getting to construction was one of the most difficult, yet rewarding, parts of the process.
With MGM’s opening as the state’s sixth and final casino, Maryland has one of the most concentrated gaming markets in the country. The resort was pitched as an $800 million project in 2012, the basis for revenue projections. But as construction progressed, features and amenities were added, increasing its budget by more than a half-billion dollars. That also meant more construction jobs, more than 1,700 of which went to county residents, and as of September, $295 million had been paid to minority-certified businesses, including nearly $118 million to businesses based in Prince George’s, according to the casino’s most recent quarterly report.
With the mammoth construction completed, the county is anticipating up to $50 million annually in tax revenue from the casino, money Baker says will help the county address such challenges as its troubled school system. Then there’s the resort’s payroll of nearly 4,000 permanent employees, about 40 percent of them county residents.
“It is entirely, economically speaking, a net positive for the county,” said Richard Clinch, who tracks gambling industry issues as director of economic development at the University of Baltimore’s Jacob France Institute.
“It will create lots of good jobs, reinforce tourism and strengthen the county’s economy,” said Clinch, who has done research for the county, Peterson Cos. and gaming companies.
And that’s good news for a county that hasn’t seen the same level of growth as Montgomery, its more affluent neighbor, and other peers in the Washington region. MGM was a crucial step in expanding the county’s commercial tax base to reduce its reliance on residential property taxes.
For its more than 900,000 residents, who for decades complained that the wealthiest majority-African American jurisdiction in the country had long been snubbed by high-end retail options, restaurants and entertainment, MGM breaks that pattern by bringing in three celebrity-chef restaurants and big-name acts, like those drawn by casinos in Las Vegas. Actress Sarah Jessica Parker is opening her first shoe store at the resort, and casino officials say there are plans to bring in professional boxing matches. Already, nearby National Harbor, a multibillion-dollar, mixed-use development at the foot of the Wilson Bridge, has boosted those options.
“The gaps in that county were large. They were underserved from an entertainment perspective, dramatically so,” Murren said. “Many of the ladies in the community said: ‘I am tired of going out of town for shopping. I want a nice salon. I want great restaurants.’ ”
Murren said he is proud to deliver on the promises he made to residents and officials at town hall meetings when the company was pursuing the license.
Upon entering the resort’s main entrance, visitors will be greeted by a seasonal display — now winter — including 60-foot-tall holiday trees and thousands of white carnations, poinsettias, orchids and other flowers. The 15,000-square-foot conservatory, which will also change each season, is larger than the popular gardens inside MGM’s famous Bellagio property.
Across from the floral showcase is an intimate 3,000-seat theater, where such stars as Bruno Mars, Cher, Duran Duran and Ricky Martin have already been booked.
The architect angled the 308-room, 24-story hotel tower to have picturesque views of the Potomac, Washington’s monuments and National Harbor. Guest are welcomed at reception by a large, intricate landscape of the region by Prince George’s artist Margaret Boozer, who used thousands of pounds of clay from the MGM construction site to create the artwork. The landscape composition, which Boozer named “Harbor,” is part of a collection of about 70 works of art decorating the walls and common spaces of the resort.
For gamblers, the 125,000-square-foot casino floor has 3,300 slots and 124 table games in addition to 39 poker tables. The casino hopes to distinguish itself by offering a more upscale experience. Its chairs are adjustable; the slots have USB ports so gamblers can charge their phones without interrupting their games; and the hotel rooms’ high-tech features include television screens embedded in the bathroom mirrors and electronic “Do not disturb” buttons.
“This is not simply a casino,” Murren said in an interview. “We don’t look at the casino business like we are in the slot machine and table business. We view ourselves in a business that cuts across many sectors: entertainment, retail, food and beverage, convention, hospitality.”
Leaders in Prince George’s are betting on MGM’s being a driving force for more development. Officials in Baker’s administration say approval of the project itself kick-started new levels of interest in the county from developers. Property values around the project began to rise, and there is anticipation of redevelopment in areas from Forest Heights to Largo. The median home price from January to August was $250,000, up 8.7 percent from a year ago.
Whether MGM is driving the growth or things are finally working in favor of Prince George’s, there are major projects underway across the county, from a research park at the University of Maryland in College Park to the recently approved construction of a regional medical center in Largo. The county also remains hopeful in its bid to win the new FBI headquarters and its 11,000 employees.
“We have proven that we can work with big companies like MGM,” said Jim Coleman, president and chief executive of the Prince George’s County Economic Development Corporation. “This brand-new facility says, ‘We are here, we are successful, we are having fun. This is a great place to live, work and play.’ ”
Regional business leaders also are embracing the new 24-hour industry, hoping it will attract even more visitors to Washington from across the country and overseas. County and National Harbor officials say they are anticipating as many as 7 million new visitors to National Harbor as a result of the casino opening.
James C. Dinegar, president and chief executive of the Greater Washington Board of Trade, said the jobs alone are an important addition to the region’s economy, while the opportunities to do business with the casino have benefited companies across the area. As Atlantic City continues to decline, he said in an October interview, the Washington region will become a destination for gamblers throughout the East Coast.
“This is a first-class operation, and it will be a very big attraction to people from around the country,” Dinegar said. “It gives us another asset to use for hospitality in this region. We will see a lot of good developed as the result of MGM.”
Although casinos traditionally don’t attract local suppliers to relocate nearby, experts say the quality of the MGM property is likely to increase tourism to the area, boosting sales at nearby Tanger Outlets and regional retail areas. The casino’s jobs pay an average annual salary of $60,000, officials say, and that could have a positive impact on homeownership in the county, which was hit hard by the housing crisis and recession.
The addition of gambling also could make the county more attractive to the more than 20 million visitors to the District each year. D.C. tourism officials plan to woo casino visitors into the city.
“We can get them for sporting events or nightlife or restaurants,” Elliott Ferguson, president of Destination DC, said earlier this year. “We will still have a degree of appeal for those customers simply because they are this close to the nation’s capital.”
Baker’s Feb. 16, 2012, announcement to pursue Maryland’s final casino marked the beginning of a seemingly impossible mission.
The state had approved a slots program and five casinos in 2008, and lawmakers were flirting with the idea of an expansion to add table games and another casino. With Prince George’s residents already gambling elsewhere, and none of the revenue coming back to the county, Baker drew on all the political capital he had earned in Annapolis to sell his billion-dollar plan.
First, he had to get Peterson and his family on board. The Petersons had made a no-gambling pledge for their National Harbor development. But amid setbacks in his project, Peterson saw opportunity in Baker’s proposal: He didn’t want a “slots hall” on his family-friendly mini-city on the Potomac, but he was in for a resort.
Next, they needed to get a high-quality operator and persuade the General Assembly to put the plan on the ballot.
MGM knocked on the door in early 2012. The company had explored Maryland as an option, but the slots-only law didn’t meet the company’s strategy. But with table games as an option, MGM looked back to the state and found National Harbor.
“It is sometimes serendipity,” Murren said, recalling the process. “Small things create big outcomes.”
Murren flew to Washington to meet Peterson, who drove him to the site in his Cadillac. It was the perfect location: suited for vehicular circulation, proximity to three airports, near the nation’s capital, a tourist-rich area on the Potomac.
“I looked all across the Potomac, over to Virginia, and literally could see the Washington Monument,” Murren said. “I knew that was the site.”
Peterson was looking for someone with a portfolio building resorts and was already in talks with other operators, but he knew that day that MGM was the one. Peterson viewed Murren’s connection to Maryland as valuable: Murren’s wife is from Maryland and the two married in a Baltimore church in 1990. The men connected. They shared a love for art. They had gone to small liberal arts schools. They wanted not a gambling hall but a destination resort. And they both saw the 23-acre Beltway parcel as one of a kind.
“When we got to the site, it is up on the hill, looking at the river, looking at Washington. And I talk too much, but I knew enough that morning to let the property speak. And he was absolutely mesmerized by it,” Peterson said.
The General Assembly was in the middle of a legislative session. Baker had laid out his conditions: a $1 billion resort and at National Harbor. He wouldn’t support any other sites, including Rosecroft Raceway, just four miles away. To Baker, bringing a high-end resort to National Harbor would boost the young waterfront community, which had struggled during the recession but was shaping into an entertainment hub.
Prince George’s was golden territory for a casino, drawing patrons from the District and Northern Virginia, where casino-style gambling remains illegal. But it was that very attribute that complicated the process. The other license holders, chiefly Maryland Live in Anne Arundel County, which was preparing to open that summer, weren’t happy. A big chunk of Maryland Live’s market is Virginia and the D.C. suburbs. Owners Cordish Cos. fought the proposal.
The proposal died in the House in the regular session. Then-Gov. Martin O’Malley (D), who opposed gambling, brought the issue back during a special session. A bill to put the casino expansion on the ballot passed that August.
“We all were kind of worried about what we called ‘slot barns’ — just a whole bunch of machines lined up in a warehouse-type of environment where there weren’t any amenities,” said Sen. Douglas J.J. Peters (D-Prince George’s), who submitted the first bill to hold a referendum on gambling expansion. “But once we got a high-quality company like MGM interested, I think that really turned a lot of people’s thoughts toward the possibility of having it.”
On the Nov. 6, 2012, ballot, voters were asked not only to expand gambling but also to decide on same-sex marriage and in-state tuition for undocumented students. For the casino measure to pass, it had to win statewide and county voters. It did. Voters authorized the expansion of gambling, allowing table games and a sixth casino license to go to Prince George’s.
“It was probably the most expensive campaign in the history of the state,” Peters said. The two sides spent more than $90 million in three months of political ads. MGM poured in $41 million.
The state gaming commission granted MGM Resorts International the license in December 2013.
When the casino opens Thursday, Baker’s bet will have paid off. The key will be whether MGM lives up to expectations.
“We are a company that keeps the promises that we make, and we made many. People believed in us and voted for us. The state believed in us and chose us. The county believed in us and worked with us,” Murren said.
“We have designed something I think is truly beautiful, elegant, distinctive and very appropriate for the setting,” he said. “We left it all on the field.”