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Apr 23, 2008 9:11 pm US/Eastern
Majestic Star Casino Takes Shape, Costs Increase
PITTSBURGH (KDKA) ―
Construction is now well underway at the North Shore home of the Pittsburgh's Majestic Star Casino -- with steel sprouting from the ground for what Detroit developer Don Barden calls his flagship casino.
But the overall project cost, once estimated at $450 million is now up to $550 million because of all the delays and legal battles with losing bidders, the Steelers, the Pirates and now the Riverfront Task Force.
"We spent tens of millions of dollars additionally that we had no intention of spending on these non-related issues, if you will, non-project issues," said Ed Fasulo, the Senior Vice President and General Manager of the Majestic Star Casino. "So it's cost us a lot of money."
Fasulo said the delays also affected getting the right loan to finance the project.
"Those six months we lost, as I just referred to, the capital markets and how they are, cost us substantially," added Fasulo. "They're additional finance costs now."
But Fasulo says it's just another hurdle to overcome.
"Now, we are putting the final pieces of the entire financing package together," he said. "Unfortunately, timing is everything in life. Credit markets aren't very friendly right now, but that's not a problem for us."
Fasulo says financing should be complete by the end of next week because Wall Street recognizes that this casino, like all the others in Pennsylvania, will be a real money maker.
"This location, this site, this license, in my opinion, is one of the premier remaining gaming sites in the entire country, as far as an urban gaming site goes," said Fasulo. "So the financial markets and Wall Street acknowledge that and recognize that so that we don't anticipate running into any further difficulties completing the financing."
The Majestic Star is scheduled to open in May 2009.
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