MGM Grand Announces Plan to Develop Venue in Motown

DETROIT -- MGM Grand took another significant stride in its initiative to expand beyond the Las Vegas Strip.

The firm formed a partnership with a group of Detroit community and business leaders to pursue a license to own and operate a casino here.

To finance the construction here as well as at other destinations, MGM announced that it received a credit line

increase from $600 million to $1 billion.

The partnership for the Detroit project will not complete plans for the development until requests for proposals have been issued.

MGM Grand said the Detroit property will be a first class gaming and entertainment facility that will attract tourists from the Midwest, Canada and throughout the world.

The local investment group consists of nine business and community leaders.

In November, the city received the green light from statewide voters to construct up to three gaming facilities.

The development of casinos is expected to be a boon for tourism, according to the Metropolitan Detroit Convention & Visitors Bureau.

New gaming and entertainment attractions will help the city attract and retain the 5.8 million travelers who pass through annually on their way to Canada to gamble, the bureau said.

Additionally, more than half of the estimated $115 million tax on casino profits expected to be generated will be used for law enforcement, economic development and community improvement programs in Detroit.

The casino projects, coupled with a program to construct a new domed stadium for the Detroit Lions football team, will enable the city to create a major urban entertainment center and spur hotel development, the bureau said.

Enhancing Detroit's appeal as a destination are several other developments, including the opening of the Detroit Opera House in spring of 1996, a revitalized theater district that ranks second in size to New York's and the Museum of African-American History, which opens this month.

In addition to its planned entrance into the Detroit market, MGM Grand said that it is pursuing expansion at other destinations.

The firm set its sights on South Africa last year when it signed an agreement with Tsogo Sun Gaming & Entertainment to act as the exclusive project developer and manager for the company.

Tsogo Sun was named the preferred finalist for two of the three gaming licenses in the Mpumalanga Province of northeastern South Africa.

The licenses are expected to be granted by the Mpumalanga Gaming Board before the end of this month.

Temporary casinos would be established by mid-1997, with permanent gaming facilities expected to open in mid-1998, according to MGM.

The projects will be located in the cities of Witbank, 80 miles northeast of Johannesburg, and Nelspruit, 220 miles northeast of Johannesburg, near Kruger National Park.

Under MGM and Tsogo Sun's agreement, Tsogo Sun will apply for a minimum of 15 casino gaming licenses in nine provinces in South Africa, and MGM said plans continue to move forward on that front.

MGM will develop and manage all casino operations for Tsogo Sun, which will provide all of the financing necessary.

In another expansion effort, MGM Grand unveiled plans last summer to build a casino-resort in Atlantic City. The company said it plans to invest more than $700 million to create the property on land it acquired along the Atlantic City Boardwalk.

MGM Grand Atlantic City will be part of a development that will include a 335,000-square-foot entertainment complex, to be built and owned by Forest City Ratner Cos. under an agreement completed by the two firms.

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