Posted on: September 2, 2020, 12:06h.
Last updated on: September 2, 2020, 03:00h.
Penn State University, located in State College, Pa., could soon be near a commercial casino offering slots machines, table games, and sports betting to anyone aged 21 and older.
Penn State alum Ira Lubert secured the rights to a so-called “mini casino” during the Pennsylvania Gaming Control Board’s (PGCB) Category 4 license auction held today in Harrisburg. Lubert, a real estate mogul who is also licensed by the PGCB in connection with his three percent ownership stake in Rivers Casino Pittsburgh, was the high bidder with an offer of $10,000,101.
The PGCB says there were two bids received, the other amount not disclosed.
Lubert chose a 15-mile radius centered in Unionville Borough in Centre County to build his Category 4 casino. Each mini casino is permitted to house between 300 and 750 slot machines, and for an additional $2.5 million, 30 table games.
Lubert has 48 hours to pay the Commonwealth the $10 million licensing fee. He then has six months to submit his casino plans and license application.
All About Football?
Lubert, should he pay the $10 million license fee and move forward with the Category 4 project, could locate his casino anywhere within a 15-mile radius of Unionville, so long as the municipality hasn’t opted out of consideration.
The Nittany Mall falls within that radius, and College Township where the shopping center resides did not withdraw its candidacy for a Category 4 casino. One of the mall’s anchors, Macy’s, closed its doors earlier this year.
Vacant malls have been preferred targets for Pennsylvania mini casinos. Penn National Gaming is renovating a former Sears into a mini casino in York, and The Cordish Companies is transforming a former Bon-Ton into a casino in Westmoreland.
The odds seem strong that Lubert’s preferred location for his casino is at the Nittany Mall. The mall is located just four miles east of Beaver Stadium, home to the Penn State football team that attracts some 100,000 fans during Saturday gamedays (at least pre-COVID).
Should Lubert’s casino come to reality, he would need to pay the state an additional $10 million to incorporate sports betting into the facility.
Playing the Game
After no bids were received during the state’s last Category 4 auction round, the PGCB opened up the bidding to principal investors in one of the state’s 13 full-scale casinos. Previous auctions were reserved for only those 13 entities.
Being an independent entity, Lubert won’t be afforded the same piggybacking privileges as earlier successful Category 4 winners. For instance, Penn National Gaming can extend its sports betting permit from its Hollywood Casino in Grantville to its satellite casinos in York and Morgantown.
Lubert, however, will not be able to use Rivers Casino Pittsburgh’s sportsbook license at his mini casino. But if anyone knows how to use a gaming license in Pennsylvania to his financial advantage, it’s Lubert.
A member of the Penn State Board of Trustees, Lubert and his partners in 2011 paid $5 million for a Category 3 casino resort license. By comparison, Category 2 standalone full-scale casino licenses cost $50 million each.
Lubert’s team opened the Valley Forge Casino Resort in 2012. Being a Category 3 gaming floor, the slots and tables were only accessible to hotel guests and members.
The Category 3 entry stipulation changed through the state’s 2017 gaming expansion, which included the mini casinos. Valley Forge was able to pay the state $1 million to allow full public access. Boyd Gaming bought the casino hotel from Lubert and partners for $280.5 million just a few months later.