By Terrence McCoy
By Scott Fishman
By Deirdra Funcheon
By Allie Conti
By New Times Staff
By Ryan Pfeffer
By Deirdra Funcheon
By Kyle Swenson
In October 2002, the tribe submitted to the NIGC the contracts that are now in force, says Richard Schiff, a spokesman for that agency. The NIGC is currently examining them to see if they violate the Indian Gaming Regulatory Act.
As profitable as the Coconut Creek Casino quickly proved itself to be, the tribe's planned resort-casinos in Hollywood and Tampa promise to be a bigger bonanza.
The Hollywood casino, which will be built northwest of the intersection of Stirling Road and State Road 7, will cover about 115,000 square feet and house about 2,000 electronic gambling machines and 65 gaming tables, making it the largest in the state. The first phase calls for a 250-room hotel, with the construction of a foundation for 500 more rooms in the future. The resort area includes 12 restaurants, 50,000 square feet of meeting and convention space, and a 1,500-capacity music arena. About 400,000 square feet of retail-entertainment space will be built in two phases.
The tribe closed on $315 million in bond financing in June 2002. The terms of the bond call for the Seminoles to pay $2 million a month for interest payments as well as save $36 million to fund the construction of casinos in Hollywood and Tampa. The estimated cost of building both is $60 million, Cox says.
The tribe began negotiating in the mid-1990s with Hard Rock Cafe International, which is a subsidiary of London-based The Rank Group, to anchor the gambling complexes in Hollywood and Tampa. The Cordish Co. was brought in as developer.
"The tribe needed Cordish," Cox recalls. "They are one of the premier developers in the country. They've never done business in Indian country, though they've been chased many times to do so."
The development company was founded by David Cordish in 1968 and focused solely on suburban shopping center developments. By the 1980s, the company branched out into large-scale urban projects in Niagara Falls, Salt Lake City, Detroit, and Chicago. Its development centerpiece, however, is on Baltimore's Inner Harbor. Cordish converted a dilapidated and abandoned brick power plant into an entertainment-retail complex, which includes a Barnes & Noble, an ESPN Zone, and the Cordish headquarters.
"I negotiated the first deal with Cordish over about six months," Cox says. "They weren't happy with it, but they were going to make a billion dollars over the life of the contract. You need a Cordish to land the big-name franchises. You're building an $800 million complex. You don't want to put in unknown restaurants. You want the Barnes & Nobles, the Hard Rocks, the Harley-Davidson Cafes. Most big-name people don't want to deal with Indian country because of the sovereign immunity, the instabilities. It's just a different environment because of the very short distance between abject poverty and where [tribes] are now. The business experience you're working with is minimal.
"What Cordish was going to do was actually bring in bidders, if you will, such as Harley-Davidson Cafe," Cox explains. "Because the goal was -- now this was me thinking -- everyone that got a spot would have a tribal member partner. 'You want to open a Harley Davidson Cafe? That's great. Who's your Indian partner? None? Sorry... next!' That way, the Indians get a double benefit: An increase in dividends, and they get business experience with a little bit of extra money over here."
The contract Cox negotiated, he says, was for ten years, similar to the Coconut Creek Casino deal. The tribe would sell municipal bonds to fund the resort-casinos in Hollywood and Tampa, but Cordish would have paid all the money to close the bonds, which would have included funding for building the casino. The tribe would have had total control over all hiring, design, and subcontracting.
"I've been around the tribe for ten years, and I knew they wouldn't save money," Cox says. "It's just not in their nature. For anybody to commit the tribe to putting away that kind of money" -- referring to the $36 million required in the current contract -- "and $2 million a month for interest payments -- it can't happen without eventually doing what they've done."
Cox maintains that Cordish seized upon the tribe's internal strife and brokered a new deal. "I think they saw an opportunity to go back and get what they didn't get with me," Cox says. "They wanted a contract for the retail and the hotel all the way up through the 25th year, which was when the Hard Rock franchise agreement would expire.
"I do know that the new contract isn't advantageous to the tribe. Are they going to make a lot of money? Yeah. Are they going to make as much as before? Yes, up to the tenth year, but on that 11th year, when you're still paying Cordish, you've just lost money. And you'll lose all the way to the 25th year. [The tribe] can't even say who the general manager is. My son, who's 5 now, he'll be 31 years old before the tribe regains control of that property. And there's no guarantee that he'll have any experience in [casino management] to make a claim as a tribal member. The last 15 years, the tribe gets fucked."
Cordish did not respond to questions e-mailed by New Times.