The developers of a proposed harbor casino don’t want to pay their full rent of $80,000 a month.
The Sun Herald has learned Mississippi Coast Entertainment LP will request a rent reduction to $40,000 for August and September. The City Council is expected to consider the request Tuesday, Steve Hendrix, attorney for property owner Gulfport Redevelopment Commission, confirmed.
Through GRC, its economic development agency, the city receives 40.5 percent of the rent because GRC owns that percentage of 10.8 harbor acres where the unnamed casino and hotel would be built. The two private owners of acreage where Misco Marine and Marine Life previously were have been working with GRC on the deal.
The council generally discusses the lease behind closed doors under an exemption to the state open meetings law that applies to lease negotiations. Hendrix said he and Virginia attorney Robert Lubin plan to talk with council members at the meeting. If the council approves a rent reduction, Hendrix said GRC also will meet to consider the request.
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Lubin and his partner, Kevin Preston of Magnolia Bluffs Casino-Hotel in Natchez, began paying rent in June. If the reduction is granted, Coast Entertainment would essentially skip its September rental payment after paying the full $80,000 for August.
Lubin said Coast Entertainment needs the reduction because financing for the casino is taking longer than anticipated. Coast Entertainment plans a minimum investment of $140 million for a small casino and 300-room hotel. The Mississippi Gaming Commission also will require an added element to attract guests, but that feature hasn’t been decided.
Lubin is raising money from Chinese investors through an EB-5 visa program. It grants permanent U.S. residency in exchange for investments of $500,000 each. The program is supposed to create jobs.
The particular EB-5 program Coast Entertainment is using needs congressional renewal once it expires at the end of September. Lubin and others believe the program will be renewed, but he said investors are wary because of the uncertainty. Lubin said 18 investors already have been lined up, but the project needs between 70 and 80 to secure financing.