Cordish to build $200 million hotel for Live casino
By Jonathan Capriel
The Baltimore Sun|
Jun 28, 2016 | 6:14 PM
The Cordish Cos. will break ground this fall on a $200 million hotel that aims to solidify the position of its Maryland Live Casino, the state's largest, in the face of rising competition.
The Baltimore-based real estate developer and casino company announced the construction schedule Monday for the 17-story hotel, which would become Anne Arundel County's tallest building. It hopes to complete the 350,000-square-foot property by the end of 2017.
Adding a resort hotel to the casino at Arundel Mills mall in Hanover will make Maryland Live more of a destination for the 10 million people who visit a year, said Rob Norton, president of Cordish Global Gaming Group.
"We've been talking to our customers for quite a while about the amenities they would like to have, and a hotel is always at the top of the list," he said. "If they are locals, they are looking for the staycation; if they are driving from two hours away, they are looking for a place to stay for a night and have a couple of days of fun."
Maryland Live has about 3,000 employees, Norton said, and expects to add nearly 400 more when the hotel, event center and restaurants are completed.
The plans include 310 guest rooms, a 1,500-seat event center, restaurants, a 24-hour cafe and a day spa. Norton said the company also plans to expand parking by about 1,000 spaces and widen streets around the mall in anticipation of increased traffic.
Maryland Live will have more than $650 million in revenue for the state fiscal year ending June 30, making it more than twice as large as the Horseshoe Casino Baltimore, its nearest competitor.
But Maryland Live will face new competition when MGM Resorts International opens its $1.3 billion casino and resort beside Interstate 495 in Prince George's County later this year.
Though Maryland Live's hotel won't open until well after MGM, Norton said the casino is prepared.
"The hotel is just one piece of the package," he said. "We've changed our marketing programs. We are adding more restaurants, some of which will open over the summer, and a venue. We are ready for them to be in the market. Generally, we think competition is a good thing."
While Norton said he plans to advertise the casinoto gamblers from outside the state, he expects the vast majority of the Maryland Live's hotel rooms to be filled by its current customers, who either live nearby or drive a few hours to visit.
The MGM property, just across the Potomac River from Virginia and a short drive from Washington, likely will have an advantage when it comes to national casino-resort visitors coming into Maryland, said James Karmel, an industry analyst and history professor at Harford Community College.
"MGM has made it pretty clear they are not spending $1.3 billion just to bring in local players," Karmel said. "MGM is looking to establish a resort destination on the Potomac, in addition to carving out a section of the regional [casino] market."
Even though Maryland Live is within a few miles of Baltimore-Washington International Thurgood Marshall Airport, Karmel said, it's hard to image the casino bringing in visitors from around the country the way MGM might. However, he said the Cordish property isn't likely to give up its position as the premier casino in Maryland.
Analysts predicted that Maryland Live would see a 20 percent drop in revenue when the Horseshoe opened in 2014. But Live proved to be formidable, easily retaining its share of the state's growing casino gambling revenue.
The new hotel is entering a crowded market for hotels around BWI, but casino officials said in a statement that they do not expect to directly compete with surrounding hotels "as it will focus on serving the existing casino base."
However, that might not be true for hotels near Arundel Mills mall, said Bobby Bowers, vice president of operations at STR, a hospitality research firm.
"It depends on the proximity of existing hotels," Bowers said. "It's just easier on the guests when the hotel is located adjacent to a casino. It allows them to gamble for a few hours, go to their room, take a break, and go and gamble again."
The number of rooms booked in Anne Arundel County hotels has increased, rising 1.5 percent in May compared with a year earlier, according to STR.
The story has been updated to accurately reflect the distance between Maryland Live and BWI.