Tower Strikes Deal with Isle of Capri for $700M Provence
If it wins the city's second gaming license, Tower Entertainment LLC will put Isle of Capri Casinos Inc. in as manager of a $700 million resort and casino, The Provence, a proposed project for the site of the iconic Philadelphia Inquirer building along North Broad Street.
“The Provence and Isle of Capri are a perfect match to build and operate a truly world-class resort and casino complex in the heart of Center City Philadelphia,” said Bart Blatstein, president and CEO for Tower, the developer. “This project is a game-changer, not only for Philadelphia, but for Pennsylvania’s gaming industry."
As part of the agreement, Isle of Capri loaned $25 million to Tower's joint venture in the form of a stand-by letter of credit that is earmarked for securing the state gaming license fee related to project, according to an SEC filing. The Isle of Capri also has the option to convert the loan into a minority interest if Tower wins the nod for the second gaming license.
In Tower's press release, Blatstein noted his close friendship with Isle of Capri CEO Virginia McDowell, a native of Philadelphia, graduate of Temple University and a former member of Temple’s President’s Advisory Board, on which she served along with Blatstein.
“Virginia and the entire Isle of Capri management team have a long and successful operating history in many jurisdictions around the country, including extensive experience in Atlantic City and on the east coast, as well as a documented track record of integrating hotels and entertainment complexes to create amazing guest experiences," Blatstein added.
Tower had planned to use Hard Rock Resort and Casino International as the manager. The contract was recently terminated due to certain timing requirements related to licensing by the PGCB, a deadline that Hard Rock's management didn't believe it could meet, according to Blatstein.
Isle of Capri previously was been approved for licensure by the PGCB to manage and operate Lady Luck Casino at Nemacolin Woodlands Resort in southwestern Pennsylvania.
The Provence is a 1.25 million-square-foot proposal, calling for a 125-key hotel to be housed in the landmark tower of the former newspaper building. The casino, totaling 120,000 square feet, will house 3,300 gaming machines and 150 table games. The development also calls for a 120,000-square-foot family-oriented rooftop village; 75,000 square-foot concert hall; eight restaurants; private swim club with two pools; 9,000 square-foot nightclub; 60,000 square feet of upscale shops; 20,000 square-foot Spa & Fitness Center; 50,000 combined square-feet of meeting and event space; and two indoor parking garages. The Casino at The Provence comprises less than 20 percent of the complex’s total scope.
The developer is projecting the resort and casino will result in 3,500 jobs and $9 million in city tax revenues related to construction. After its completed, another 3,500 jobs and $25 million of annual tax revenue are projected from gaming revenue, ongoing operations and ancillary spending. Tower plans to fill more than 2,000 permanent and temporary jobs with residents in the surrounding area.
If developed, the Provence could spark two million to three million of commercial and residential development during the next decade, which could equate to $1 billion of investment in the Center City as well as serve as a catalyst for bookings at the expanded Pennsylvania Convention Center and tourism. As for the state, Tower projects the project will create 11,400 jobs and $30 million in tax revenues during construction and 7,800 jobs and $199 million in annual revenue once it's up and running.