Posted on: September 6, 2024, 08:50h.
Last updated on: September 6, 2024, 09:51h.
The developer behind a planned casino in State College, Pa., just miles from the Pennsylvania State University campus, has gifted the school $10 million for its football stadium renovation project.
Ira Lubert won the rights to a Category 4 casino license on Sept. 2, 2020, when he was the high bidder during an auction round conducted by the Pennsylvania Gaming Control Board (PGCB). Lubert submitted a bid of $10,000,101 that narrowly edged Baltimore-based Cordish Companies.
This week, Lubert, a 1973 Penn State graduate whose real estate firm, Lubert-Adler, has a deep portfolio in office, industrial, residential, retail, and hospitality across the nation, announced a $10 million gift to the Beaver Stadium Revitalization. The donation will result in the Lubert Family Welcome Center, a new “landmark space” at one of the stadium’s entrances. The renovation project is to be completed in 2027.
Coming to Penn State set me on a path that has led to professional success and personal fulfillment, and I am honored that the Lubert Family Welcome Center will offer a fresh, exciting first impression for future Penn Staters as they discover all that the university offers,” Lubert said.
The Penn State Board of Trustees approved a $700 million renovation of Beaver Stadium in May. While most of the investment will be financed and no tuition money will be used, private donors continue to help reduce the amount of interest the school will pay by lessening the principal. With Lubert’s contribution, the renovation has now received $55 million in donations.
Nearby Casino Saga
The renovation of Beaver Stadium has faced significant scrutiny as the $700 million project comes as the school continues to try and reduce its costs by offering some employees buyout packages. Another high-profile controversy in Centre County is Lubert’s plan to open a casino.
After winning the September 2020 auction, Lubert announced a partnership with Bally’s Corp. to invest $123 million to renovate the former Macy’s department store at the Nittany Mall into a so-called mini-casino with up to 750 slot machines and an initial allotment of 30 live dealer table games, plus a sportsbook. The mall is less than five miles from the PSU Main Campus and Beaver Stadium.
Cordish raised allegations in litigation that Lubert violated bidding protocols by orchestrating an investment group that helped him fund the $10 million bid. Lubert’s investors, who were detailed later, were not eligible to bid since they didn’t hold “an ownership interest in a slot machine license” as Lubert did with his 3% stake in Rivers Casino Pittsburgh.
Cordish argued it should have been the only qualified bid that September, but the case, which made its way to the Pennsylvania Supreme Court, came down in Lubert’s favor. The state’s highest court in July upheld lower courts’ rulings in deciding that Lubert, while he might have organized an investment group to build the casino, had retained 100% control of SC Gaming OpCo, the entity he bid as, during the auction and subsequent remission of the $10 million fee.
PSU Steers Clear of Casino Controversy
After years of legal delays, Bally’s, which will operate the State College casino, told investors during its second-quarter earnings call that construction at the Nittany Mall is targeted for the first half of 2025.
Marcus Glover, the chief financial officer of Bally’s, said the company and Lubert’s team are “going through the process and obtaining the appropriate approvals.”
In July, Bally’s accepted a takeover from Soo Kim’s Standard General hedge fund. Bally’s has recently faced several credit downgrades, concerns about its financial outlook, and worries that the company could be overleveraged.
Many in the State College community remain opposed to the casino. Despite widespread opposition and thousands of local residents expressing disdain for a casino coming so close to where roughly 50,000 students study, the Penn State Board of Trustees refrained from taking a public position on the project. Since the College Township Council failed to opt out of being considered for a Cat. 4 casino, there is seemingly little recourse to block the Bally’s Pennsylvania casino.
Kim has remained quiet about what Bally’s future might look like once he takes full control. Under Standard General, Bally’s is expected to direct much of its focus on its $2 billion Bally’s Chicago undertaking, and possibly, a new resort in Las Vegas. That could prompt the company to fold on smaller regional operations like the one coming to State College.
