NASCAR: Kansas Speedway Casino developer has not built hotel

When Penn Entertainment was granted permission to develop what became its Hollywood Casino at NASCAR’s Kansas Speedway, it also pledged to build an adjacent hotel within two years. But 10 years and counting from that deadline, no such hotel has materialized.

Instead, the developer has preferred to pay $13 million in fines, the penalty for missing 10 deadlines in a row.

In return, the project received STAR bonds from WyCo & KCK. This is a special financing tool that Kansas municipalities can issue for the development of major commercial, entertainment, and tourism projects.

Under the agreement, construction on the hotel would begin within the second anniversary of the casino’s opening (February 2014). If this did not occur, Kansas Entertainment LLC would pay 1% of the casino’s annual net gaming revenues to WyCo & KCK until the work began, per the agreement.

Kansas Entertainment LLC initially said it hoped to break ground on the hotel in October 2014, but that was later revised to 2015, pending the results of an economic study.

Later that year, the developer announced it would postpone the hotel project, citing “soft economic conditions in the region, especially in the hotel market.”

Penn has said it monitors area occupancy rates and new hotel developments in the region and insists it “continues to explore various opportunities to build a hotel adjacent to Hollywood Casino.”

“As part of that evaluation, we consider the existing infrastructure and occupancy rates of neighboring and nearby hotels, as well as the marketing partnerships we have developed with these businesses over the years,” Jeff Morris, Penn’s vice president for public affairs and government relations, told The Kansas City Business Journal last year. Casino.org