Cappelli Shuffles Plan, Seeks $1B Resort

ROCK HILL, NY-Now that Indian casino gaming is no longer in the cards for the Catskills, developer Louis Cappelli says he is going “all in” with a $1-billion resort/hotel entertainment complex now called “Entertainment City” at the former Concord Hotel. Cappelli’s firm Concord Associates L.P. and partner Empire Resorts Inc. held an informational session on Thursday afternoon to go over his revised plan for the former 1,735-acre Concord Hotel property in the Town of Thompson. Now that the Bureau of Indian Affairs has killed Native American casino gaming at the former Monticello Raceway, Cappelli told several hundred attendees of the meeting at the Lodge Hotel in Rock Hill that he intends to pursue a more than $1-billion plan, instead of the $500-million project he proposed back in 2000.

Cappelli, along with Concord Associates, is a major shareholder in Empire Resorts, which until earlier this year was pursuing a $600-million casino gaming facility at the Monticello Raceway. However, when Department of Interior Secretary Dirk Kempthorne rejected the project back in January, the casino venture and the Empire partnership with the St. Regis Mohawk Tribe disintegrated shortly thereafter.

The redevelopment project has received just about all the necessary site plan approvals and is awaiting the Town of Thompson’s OK, on Tuesday, for the project’s plan to relocate the raceway to the Concord Hotel site, a few miles away. Empire Resorts CEO David P. Hanlon tells GlobeSt.com that the Empire-Cappelli partnership will also work on a master plan to redevelop the 200-acre raceway site. Once Cappelli gets the approval, he says demolition of the famed Concord, with the exception of one building, will begin next Thursday.

The revised plan calls for the development of 1.5 million sf of hotel/convention space, 600,000 sf of retail, a several-hundred-room hotel/spa and perhaps as many as 3,000 housing units. The project will include resort type uses, similar to a Great Wolf Lodge, or another type development, that will transform the site into a year-round resort. The project site will also include a racino, which is currently located at the Monticello site, that would be relocated to the Concord property. The racino, which has more than 1,500 video gaming machines, has been suffering from declining revenue due to competition from conventional casinos in Pennsylvania and Connecticut, as well as a racino at Yonkers Raceway in Westchester County, NY.

While Cappelli has completed numerous high-profile developments in White Plains and New Rochelle, and is in a partnership to develop a $1.5-billion waterfront redevelopment initiative in Yonkers, his company, at this point, has failed to come through on its highly touted plans to redevelop the Concord property. Capelli had purchased the Concord Property out of bankruptcy in 1999, and then a year later, held a groundbreaking ceremony to unveil the $500-million redevelopment plan for the site.

In reference to that, Cappelli said, “I am disappointed in myself and in my organization because we are not used to starting something that we can’t finish.” He later said that instead of standing by the wayside and waiting for casino gaming and having the Concord be the hotel/resort compliment to a casino, the hotel will now be the engine for growth in Sullivan County.

Since 1999, his firm has had a $100-million investment in Sullivan County, in terms of site work at the site, infrastructure improvements, enhancements to the Monster Golf Course at the Concord, as well as, in taxes paid for the properties it owns. Cappelli says his revised development plan of more than $1 billion is necessary, because without casino gaming, a project of this size is required to serve as a catalyst for growth elsewhere in Sullivan County. Cappelli also owns the Grossingers resort in Ferndale and has an option to purchase Kutsher’s Sports Academy in Monticello.

“As they say in poker, we have no choice but to go ‘all in,’” Cappelli says, adding that the venture needs “the critical mass or else it will fail.” The Cappelli-Empire partnership is looking for state assistance in connection with the project. For the larger $1-billion proposal, the developer is looking to have the state approve the lowering of the state’s annual take on its racino revenue from 68% to 25%, which would have been the share given to the state by the Native American casino at Monticello racetrack. Cappelli stresses that, if his measure is approved by the state legislature and signed into law by Gov. David Patterson, he will double the current Video Lottery Terminal contribution to the state’s education budget (now estimated to be $22 million in 2008) and would also increase annual contributions to local governments and to the horsemen at the racetrack.

The developer has also floated a proposal to state lawmakers that in connection with its original $500-million project, it would need a $20-million annual state capital contribution for a period of 30 years. Cappelli says that he is hoping the state will approve the proposal that would allow the $1-billion plan to be developed. Thompson Supervisor Anthony Cellini urged those in attendance to support the Cappelli plan, as did State Assemblywoman Aileen Gunther. The session was also attended by local organized labor organizations. Cappelli told the mostly supportive crowd that the mixed-use development would be a union-built project.