Tribe, Caesars break ground on $650 million Virginia casino project
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The tribe, through EBCI Holdings LLC , will have a 49.5% stake in the project, as will Caesars. A business owner from the City of Danville will hold the remaining 1%, Sneed said.
Once complete, Caesars Virginia will include a 500-room hotel and a gaming floor with more than 1,300 slots, 85 live table games, 24 electronic table games, a World Series of Poker poker room and a Caesars Sportsbook. The facility will also feature a full-service spa, pool bars and restaurants, a 2,500-seat live entertainment theater and 40,000 square feet of meeting and convention space.
Caesars will manage operations at the facility, to be constructed on a 78-acre property located at 1100 West Main St. in Danville. Caesars Virginia bought it in December 2020 from Schoolfield Properties LLC for $5 million
The project is an exciting and needed step toward diversifying the tribe’s revenue streams as more states approve expanded gaming and existing casinos in Cherokee and Murphy prepare to face competition, Sneed said.
“We can’t sit back and play defense or wait to see what happens,” he said. “We have to be very proactive. And it’s just good business sense, to diversify and be a participant in those emerging markets.”
The casino is expected to open in late 2024, “fingers crossed” that variables such as supply chain issues, labor shortages and inflation don’t delay the timeline, Sneed said.
Sneed said that 21 million people live within a three-hour drive of Danville, raising expectations that the casino will be quite lucrative once complete. Danville is a four-hour drive from Cherokee, just over the state line north of Greensboro, and will not directly compete with the Cherokee market, Sneed said. Its main feeder markets will be Raleigh, Durham and Greensboro — currently a “single-digit percentage” of Cherokee’s players come from those markets.
It’s not yet certain what the revenues will fund. At the tribe’s existing casinos in North Carolina, half the profits enter the tribal budget while half are disbursed to tribal members in semi-annual per capital payments. Tribal Council will have to pass a written allocation plan specific to the Danville casino, which could include contributions to per capita, tribal programs or other uses.
The Danville project is Cherokee’s second attempt to open a casino in Virginia, which through a 2019 law opened the door to permit casinos in five cities. Cherokee had initially hoped to build a casino just outside Bristol , but the license was awarded to Hard Rock International instead.
“Danville was the only city out of all the cities that were predetermined to receive a gaming license that actually did a competitive bid process,” Sneed said. “I believe there were seven respondents to the bid, and Caesars won the day.”
The tribe had a right of first refusal to partner on the effort and chose to exercise that option, Sneed said.
Tribal Council approved the Danville project in May 2021, when it voted 9-3 in favor of a resolution that was spare on specific information but discussed an undertaking dubbed “Project Commonwealth,” a partnership with a company with which the tribe had a “long-standing relationship” resulting in new gaming opportunities “within a certain proximity” of existing casinos in Cherokee and Murphy.
- A rendering shows what the facility might look like once completed. Donated image
The resolution states that the partner company — Caesars — will manage the operation for at least five years, but EBCI Holdings will hold call rights to buy it out in five to seven years after it opens to the public. The project is to be wholly owned and operated by the tribe through EBCI Holdings.
No dollar amount was included in the resolution, and Tribal Council discussed the resolution off-air prior to the vote.
The tribe has another similar project in the works in Kentucky.
In a special-called meeting Wednesday, April 13, Tribal Council approved a plan from EBCI Holdings, Inc., to bid on an opportunity to build two new out-of-state casinos, calling the endeavor “Project Thoroughbred.” According to the resolution, if EBCI Holdings is selected as the winner, it will make a deposit from its own accounts of about $2.5 million. Then, the tribe will provide $25 million from its endowment and investment accounts — plus or minus 10% — “all or a portion of which will be contributed or otherwise invested, directly or indirectly, in the Project, which is calculated at this time to provide a 44% equity stake.”
Sneed said he’s not ready to give more information but that Project Thoroughbred is “moving along exactly how we wanted it to, and we’re excited about the potential.”
“Economic diversification” has been a buzzword in Cherokee for years as casino revenues have grown — as has the threat of competition. Last year, a new federal law ended the EBCI’s years-long fight to stop the Catawba Indian Nation from building a casino in Kings Mountain, and the Catawba are now operating a temporary facility on the site while they plan to build a permanent facility. This, along with increased interest from neighboring states in legalizing various types of gambling, has spurred tribal leadership to create multiple LLCs tasked with expanding the tribe’s revenue-generating enterprises.
“Knowing that those markets are emerging, this just continues to build our portfolio, our reputation in the gaming industry,” Sneed said of the Danville project. “And so that gives us the opportunity to participate in those markets as they emerge.”
EBCI Holdings was created in December 2020 to manage the tribe’s commercial gaming enterprises when Tribal Council approved purchase of the first such enterprise. The EBCI now owns the operations — though not the property — of Caesars Southern Indiana Casino, which it purchased for $250 million. With the one-year anniversary of the purchase coming up Aug. 19, Sneed said the property is performing “ahead of projections.”
