City OKs Gateway land for slots parlor

The plans for Baltimore's slots parlor began taking shape publicly Wednesday as the Board of Estimates modified the original deal and permitted the facility to rise on valuable city-owned property that previously was considered off-limits because it had been promised to another developer.

The Baltimore City Entertainment Group, the sole entity to bid for a gambling license in the city, now envisions a larger slots palace with access to 11 acres of additional property. It promises to transform a gritty section of the city into a destination, but has raised the eyebrows of developers who opted not to bid for a city slots license and were surprised that the terms of the deal could shift so significantly.

The deal passed through the Board of Estimates, the city's powerful executive body, on the routine agenda with no discussion or debate, although Comptroller Joan M. Pratt, who opposes gambling, voted against it.

The slots parlor now will have direct access to bustling Russell Street instead of being a block off the road that leads to Interstate 95 and Route 295. The extra space will easily accommodate more than the 500 slot machines in BCEG's original application, since increased to 3,750. And it also will allow additional attractions, which could include retail, a theater and a night club, Michael Cryor, a spokesman for the BCEG, said Wednesday during an interview.

"We have the opportunity to do a number of things," he said.

The board's approval formalized a previously reported agreement that puts the slots parlor on the former Gateway South parcel. A development group, which included Ravens linebacker Ray Lewis, had highly touted plans to build a "sportsplex," including a football-shaped tower, in the shadow of M&T Bank Stadium. But those plans never materialized.

Cryor stressed that no decisions have been made on new attractions. "For an opportunity like this it really does pay to do the first thing that you planned to do and then do that well and see what that creates," he said.

The planners expect additional gambling revenue from the new location, which could increase the city's profits and mean citizens will see a larger cut to their property taxes. A parlor on the old site was expected to fuel an 8-cent reduction. The city expects a revenue estimate for the new location within three months.

BCEG still must secure a gaming license from the state lottery commission. If they fail to do so, the land would be returned to Cormony Development, which had been selected by the city in December 2006 to build the $250 million sportsplex.

"This is still very fragile," said M.J. (Jay) Brodie, president of the Baltimore Development Corp.

The deal included a payout of at least $3 million from BCEG to Cormony as an incentive for the development firm to bow out of its project, according to a person familiar with the negotiations. Samuel Polakoff, the head of Cormony, did not return calls.

City officials distanced themselves from that part of the deal, with 1st Deputy Mayor Andrew B. Frank describing it as an agreement where "one private party assumed the obligations of another."

The deal surprised other developers. "We were not aware that the [Russell Street] land was available directly through the city, and to the contrary it was represented to us that the Gateway land was controlled by the private sector," wrote Jon Cordish, a vice president with the Cordish Co., in an e-mail. The company plans to build a competing casino in Arundel Mills and did not bid on the Baltimore site.

"Had we known the City planned to make this land available to any bidder, this would clearly and dramatically affect our appraisal of the location, as it would have for other potential bidders."

Samuel Himmelrich Jr., a developer who had bid for the Gateway South project and lost to Cormony, said that he also might have applied for the city slots license if he'd known the more desirable land was available.

When the city awards land to a private developer it usually goes through a competitive bid process. Frank, the deputy mayor, acknowledged that this deal was "unusual."

"These are a unique set of circumstances that led us to believe it was in the best interest of the city," Frank said.

The new plan means the parlor will be constructed at the site of the old Maryland Chemical facility, which the city demolished after spending $1.7 million relocating the company to Fairfield in December 2007. The Board of Estimates also approved $49,500 yesterday for removing an oil tank from the former Maryland Chemical site.

Frank expects the buildings to be attractive. "This should be the Camden Yards of slots facilities," he said.

The new plan also includes Lot O, a city-owned parking lot on Ridgely Street that Ravens fans use, as possible satellite parking for casino employees. The immediate fate of the site for the original slots parlor, Ravens' parking Lot J, is unclear. Cryor said that his group likely will use that space at some point in the future.

Brodie, with BDC, said that the BARCs animal shelter, which would have been displaced under the original plan, now will remain on Stockholm Street. He said the city was "still committed" to the Greyhound bus station on the southern part of the parcel. The lease for that facility is up in 2012.

Second Chance, a popular architectural salvage company on city-owned land, will be displaced, Brodie said. The nonprofit occupies warehouses along five blocks of Warner Street, and Brodie said the city would help move it elsewhere in the city.

Cryor had originally planned to present a preliminary plan to the Urban Design and Architecture Review Panel on Thursday, but that was canceled because he wants to show his plans first to the Local Development Council, a panel set up by the state slots legislation to review site proposals. The plans will only show where buildings will be constructed, not detailed architectural renderings, he said.

BCEG has selected Reich & Petch, a Toronto-based architecture firm to plan the facility.

Baltimore Sun reporter Edward Gunts contributed to this article.

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