SL Green and Caesars Entertainment have a glam new partner in their hoped-for Times Square casino — Brooklyn-born billionaire rapper and entertainment impresario Jay-Z and his Roc Nation, Realty Check has learned.
The three-way partnership, to be announced at SL Green’s annual investor conference on Monday, marks a dramatic twist in the developer’s and Caesars’ quest to launch a casino at SL Green’s 1515 Broadway office tower. (They’re among a half-dozen teams that are also expected to submit proposals to the state for a first full-scale casino in the Big Apple.)
Although details have yet to be spelled out, Jay-Z and his team are expected to oversee entertainment programming at 1515 Broadway and at other SL Green properties at the “Crossroads of the World.” The city’s largest commercial landlord, SLG has interests in six Times Square properties with a total of more than four million square feet.
In a statement, Jay-Z said, “New York is the epicenter of culture. We have the opportunity to create a destination at the heart of the true crossroads of the word. My partnership with SL Green and Caesars has all the promise and commitment to economic opportunity, growth and enrichment for the community and everyone that visits the Empire State.”
SLG chief executive officer Marc Holliday also shared more specifics about his company’s casino proposal than have ever been disclosed.
Contrary to claims that Caesars Palace Times Square, as it’s to be called, would be a mammoth gaming mecca that might overwhelm everything around it, the casino would occupy only eight floors in the 54-story tower between West 43d and 44th streets.
None would be the ground floor, which is earmarked for non-gaming uses including an entrance to the Minskoff Theater, home of “The Lion King.”
“We are putting theater at ground level,” Holliday emphasized.
The casino floors would also house restaurants and entertainment uses. Holliday estimated that the “boutique”-size casino might occupy as little as 250,000 square feet of floor space, a postage stamp compared with typical, sprawling gaming floors in Atlantic City or Las Vegas.
A new, approximately 800-room, five-star hotel would be created in the building above them. Holliday said he was “not yet prepared” to address how the tower’s office tenants, including Paramount Global’s headquarters, would be affected.
He rebutted claims by the Broadway League, which represents theater owners and producers, that a casino would be “dangerous” to Broadway theaters. On the contrary, he said, SL Green’s proposal is designed to bolster all the businesses around it. Although the League is adamantly opposed to having a casino in its midst, the plan is enthusiastically backed by owners of restaurants such as Carmine’s, Bond 45 and Junior’s and by Actors Equity and hotel and construction unions.
According to Holliday, consulting firm AKRF projects that casino visitors will buy 400,000 net new Broadway tickets annually. Additionally, SLG/Caesars/Roc Nation will purchase thousands of tickets directly that will be provided both to casino patrons and to underserved communities.
The casino company’s loyalty program known as Caesars Rewards, which boasts 60 million members worldwide, provides so-called bankable rewards that can be used at hotels, restaurants, theaters and stores beyond 1515 Broadway.
As part of a “halo effect,” Holliday expects the casino will generate seven million more annual visitors to Times Square, generate seven million restaurant meals outside the casino and $166 million in retail purchases outside the casino building.
In SL Green’s view, the 1515 Broadway project is needed to help arrest a slow, gradual decline in the district’s fortunes.
The slide, Holliday said, doesn’t yet mark a return to the lawless days of the 1970s-early 1990s — although crime is noticeably up — but rather a slow-but-steady unraveling of the commercial energy and sense of security that Times Square had only 10 years ago.
Some major companies such as Skadden and EY have moved away. Times Square-district office vacancy has soared from 5% in 2012 to nearly 25% today, according to CBRE.
Since Toys ‘R’ Us left in 2015, more national retailers — possibly including Forever 21 and American Eagle Outfitters — are also looking to exit, citing a decline in the quality of the street environment. Meanwhile, more taco, doughnut and other types of fast-food joints are moving in.
The state will issue a formal request for proposal (RFP) for casino applicants next month. The selection panel will then move some responses to a state siting committee, which is expected to choose one location in the five boroughs before the end of the year.
In addition to SLG/Caesars/Roc Nation, wannabe operators are expected to include Related Companies and Wynn Resorts at Hudson Yards, Mets owner Steve Cohen and a casino partner near Citi Field in Queens, and Soloviev Building Company and a casino partner for a complex called Freedom Plaza on First Avenue in the East 30s.
At least one company is moving to Times Square: accounting advisory firm Anchin, Block & Anchin signed a lease for 45,673 at Rudin’s Three Times Square, which is undergoing a major, $25 million upgrade program.
Anchin will move from 1375 Broadway in fall of 2023.
Landlord executive vice-president Michael Rudin said that Anchin was “exactly the sort of firm we had in mind” when his company set out to reposition the tower, where Touro College and University System signed for 243,000 square feet earlier this year. About 450,000 square feet remain available.
Anchin was repped by teams from Colliers and Cushman & Wakefield. Rudin was repped in-house.
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