Summit Out, But Other Suburbs Still Competing for Casino

Southtown Star Reporting

SUMMIT-- Summit has dropped its bid to become home to the state's 10th casino, leaving Country Club Hills and Calumet City as the only south suburbs competing for the prize.

Summit Mayor Joseph Strzelczyk had been working with the wealthy Pritzker family of Chicago's Hyatt Gaming Management Inc. to bring a casino to the village. But with the credit crisis drying up sources of financing, it proved impossible to put a deal together by the Illinois Gaming Board's Tuesday deadline, he said.

Strzelczyk had said it was still "up in the air" whether the village would be applying for the 10th license, which has sat unused for a decade, costing the state an estimated $1 billion in revenue.

But a few hours later, a key investor called to tell him it would not be possible to meet the deadline, ending Summit's hopes, according to Strzelczyk.

"The times are too hard," Strzelczyk said. "It's obviously a shattered economy."

Michael Shindler, chairman of the board of directors of Hyatt Gaming, said the company did not want to invest in or operate a Summit casino. But given their stake in Elgin's Grand Victoria Casino, Pritzker family members wanted to try to prevent a casino from landing nearby in Des Plaines or Rosemont, he said. They also believe it makes more sense to place a casino in a relatively poor South Suburb than in a wealtheir community, he said.

"It's time for the South Side," Shindler said.

While the top bids for the license four years ago exceeded $500 million, Shindler said he expected to see bids in the neighborhood of $200 million or less next week.

Michael Paladino, a gaming analyst for Fitch Ratings in New York, said battered credit markets would make it difficult to finance a new casino.

Among the big publicly traded casino owners, many "are very highly leveraged and somewhat strained in their ability to invest in new opportunities," he said. "Any type of new financing is going to be challenging."

Nevertheless, Country Club Hills and Calumet City say their bids are on track. In addition to Rosemont and Des Plaines, Waukegan also is vying for the license.

Prime Group Inc. and Capri Capital Partners, both of Chicago, are partnering on the project in Country Club Hills with a publicly traded casino operator, Country Club Mayor Dwight Welch said. He declined to name the operator.

The casino would be part of a planned entertainment complex complete with a water park, hotel, outlet mall, banquet facility and convention center at Crawford Avenue and Interstate 80, Welch said. Also involved in the project is the site's owner, the Gatling family.

Welch said only 10 to 15 percent of gambling revenues would go to Country Club Hills, with the rest being split up among dozens of other South Suburban municipalities and school districts.

"We're in an area that really needs help," he said.

In July, Welch said he expected Country Club Hills' bid would be in the range of $400 to $500 million. But on Friday he said those numbers were no longer realistic.

"That was before the bomb hit," he said, referring to the fear that has gripped the financial markets for weeks. "It's a different world."

Calumet City is working with 1893 Entertainment Group LLC on a mixed-used development near Torrence Avenue that would include a casino. The city will reveal details of the proposal at a press conference Tuesday.

"We're kind of keeping everything tight right now until the application is in," said Eric Schneider, the city's director of communications.

The proposal includes a revenue-sharing component, Schneider said.

The gaming board plans to select three finalists from among the applicants "as soon as practical," hold a public hearing and then negotiate with all three before eventually settling on a winner.

The 10th license, once held by Emerald Casino, was awarded to Rosemont in 2004. But allegations that some casino backers had mob ties led to a long drawn-out battle that eventually scuttled the project.

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