Satellite Casino Construction Near Pittsburgh Begins, $131M Venue Expected to Open in 2020

Posted on: April 22, 2019, 10:35h. 

Last updated on: April 22, 2019, 10:35h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Construction is underway for a satellite casino near Pittsburgh inside a former Bon-Ton department store at the Westmoreland Mall.

Pennsylvania satellite casino Westmoreland Mall
A former Bon-Ton at the Westmoreland Mall will become a satellite casino next year. (Image: WTAE)

The Cordish Companies – a Baltimore-based real estate and hospitality development firm – won the rights last year to the Pennsylvania satellite casino during the state’s second auction round. The bid was $40.1 million, and the company selected a 15-mile radius centered in Westmoreland for the gaming venue.

The project as a whole is moving forward,” Hempfield Township Planning Coordinator Patrick Karnash told the Tribune-Review.

Cordish’s Stadium Casino LLC subsidiary is building the casino, which will be permitted to house up to 750 slot machines and 40 table games.

Local Aid

Pennsylvania lawmakers approved of the satellite casinos in late 2017 as a way to help fund a budget gap without increasing taxes on residents. Governor Tom Wolf (D) signed the massive gaming expansion measure into law.

Along with the mini-casinos, the package legalized online gambling, slots at certain diesel truck stops, airport gaming lounges, daily fantasy sports, and set guidelines for sports betting.

There has been plenty of opposition across the Commonwealth to allowing the gaming venues to set up shop. A total of 936 boroughs and townships passed local ordinances that removed their candidacy from the Category 4 casino process. Hempfield did not.

Satellite casinos will see gross gaming revenue from slot machines taxed at an effective rate of 54 percent, while revenues from table games will be subjected to a 16 percent tax. However, the vast majority of the money will go to the Harrisburg capital – not local coffers.

What’s in it for Hempfield?

Of the Category 4 casino proceeds, five percent will be allocated to the host county of the casino. Two percent will be earmarked for Commonwealth Finance Agency grants to the host county, and another two percent is directed to the host municipality.

Stadium Casino executives say that will total around $1.8 million annually.

The casino is also expected to employ 500 workers on an average salary of $43,000 per year. The total economic annual economic impact projection is $152 million.

Mall Gambling

In the era of Amazon, the brick-and-mortar retail business has struggled. For regional malls, vacant stores have become part of the norm.

In Pennsylvania, the large properties are ideal nearly turn-key solutions for satellite casinos. Developers also believe they can rejuvenate mall business.

By adding the facility to the mall, we actually believe it will create a complete entertainment destination,” Cordish Companies President Rob Norton said. “The way malls are heading and physical shopping is heading in today’s environment with online proliferation, we are seeing that the move to more entertainment focus is actually helping the physical establishments and actually driving bodies back to the malls.”

The Westmoreland Mall is about 35 miles east of Pittsburgh. The Bon-Ton store closed last July amid the company’s liquidation. The mall lost another anchor – Sears – when it closed last month.