MGM Springfield Ahead of Schedule on Casino, But Behind on Housing Development

Posted on: July 18, 2017, 12:00h. 

Last updated on: July 18, 2017, 10:19h.

MGM Springfield has received approval from the city council there to push back a deadline to develop 54 units of market-rate apartments.

MGM Springfield Court Square housing
MGM Springfield is delaying its commitment to renovating a vacant former hotel overlooking Court Square, a picturesque center commonly referred to as the city’s “front door.” (Image: Derek Strahan/Lost New England)

The housing project is part of the casino company’s commitment to bringing market rate housing to the downtown area surrounding its $950 million resort.

In part of its Region B (Western Massachusetts) casino license, MGM Resorts pledged to invest in potential housing and mixed-use development projects in areas located within a half-mile of its resort. One targeted site is the 13-31 block of Elm Street.

Under its host community contract, MGM Springfield agreed to help the city renovate the building into at least 54 apartments. Those plans, however, have been delayed due to contract negotiations.

On Monday evening, the Springfield City Council unanimously approved postponing the housing development deadline until 2020. The previous arrangement called for 30 of the occupancies to be finished by August, and the remaining units due by September of 2018.

Council Candidate Upset

Springfield City Council candidate Jesse Lederman is using the MGM setback as a campaign platform.

“The delay and uncertainty of the MGM housing development project is very concerning for voters who supported a host agreement that touted the benefits of such a project,” Lederman said in a press release. “MGM has a responsibility to the residents of Springfield.”

Springfield City Solicitor Edward Pikula said the project is “very complicated” due to the involvement of the city, developers, and MGM. He added that the city “must get it right,” as the apartment complex is a key component to the downtown revitalization.

31 Elm Street is a historic building that overlooks Court Square, the only space in the city that has largely remained untouched since Springfield’s founding in 1636. The building was previously the Court Square Hotel, and also housed office units. Today the six-story structure is in desperate need of reconstruction after sitting unoccupied for years.

Elm Street is expected to cost between $35 million to $45 million. But MGM won’t be on the hook for all of the capital.

The Springfield Redevelopment Authority (SRA) owns the building, and is expected to receive some $10 million in tax credits from federal and state housing funds. MGM told the council it remains committed to funding the outstanding expenditures.

Once completed, it’s expected that 40 of the apartments will be leased at market-rate prices, while 12 will be earmarked for lower income families that have employment in downtown Springfield.

Resort Springs Ahead

While MGM is allegedly dragging its feet on funding 31 Elm St., construction at the casino is progressing faster than expected.

Originally planned to open in the fall of 2018, MGM is now reportedly looking at a May opening. The $950 million development broke ground in March of 2015.

Construction moving ahead of schedule is great news to MGM executives who want to open the casino and establish a loyal customer base before an expansion satellite gaming facility does in northern Connecticut.

Lawmakers in the neighboring state have authorized a tribal facility in East Windsor, Connecticut, on off-sovereign ground in order to compete with the Springfield mega resort.