What’s Next For the New York Downstate Casino Race?

The competition for three coveted downstate New York casino licenses has entered a period of heightened uncertainty after two high-profile proposals were rejected in swift succession last week.

On Wednesday, Caesars’ Times Square project and Silverstein Properties’ Avenir development near the Javits Center both failed to advance past their Community Advisory Committees (CACs). Each committee voted 2-4 against the projects, falling short of the four “yes” votes required to move forward. The decisions, delivered in back-to-back meetings lasting less than 30 minutes combined, surprised some observers who expected CACs to allow most proposals through to the next stage of review.

The rejections underscore how precarious the downstate casino process remains, even as state leaders weigh the financial and political stakes. New York faces a projected $34.3 billion budget gap through 2029, and each license carries a $500 million fee—seven times higher than the upstate licenses awarded nearly a decade ago.

Momentum Stalls for Manhattan Projects

The two denials mark a setback for some of the most ambitious proposals in the race. Caesars’ $5.4 billion Times Square casino—backed by SL Green and Roc Nation—faced opposition from Broadway and theatre stakeholders. Avenir, a $7 billion plan featuring a Hyatt hotel, art gallery, and gaming floor operated by Rush Street Gaming, drew pushback from local residents.

Stakeholders reacted sharply. SL Green CEO Marc Holliday accused the Caesars CAC of denying the city needed investment, while Avenir’s team argued its vote was tainted by a last-minute committee request. Both groups maintained their projects would have delivered jobs, housing, and community amenities in addition to gaming revenue.

The rapid votes also raised questions about process. Some CAC members alleged that certain colleagues accelerated the timeline, cutting short deliberations. Project documents for both Caesars and Avenir were later removed from the state’s website, deepening the sense of opacity.

Following Monday’s rejection of Freedom Plaza—a proposed $11 billion mixed-use complex—five proposals remain in contention. Among them, MGM Empire City in Yonkers and Resorts World New York City in Queens are seen as frontrunners. Both operate existing video lottery facilities, giving them a speed-to-market advantage and established community relationships.

Industry observers note that the state could choose to award two licenses to MGM and Resorts World quickly, securing tax revenues, before deciding whether to approve a greenfield project later. Yonkers Mayor Mike Spano has been an advocate for this phased approach.

By contrast, standalone developments in dense Manhattan neighborhoods appear to face tougher odds. Neither Caesars nor Avenir showed a decisive advantage in community support, and Freedom Plaza’s defeat suggests local resistance remains a powerful factor.

Lessons From Upstate—and Abroad

New York’s casino history suggests the outcome could remain unpredictable until the final decisions are announced. When upstate licenses were awarded in 2015, regulators surprised industry insiders by bypassing Orange County despite intense competition there.

Some analysts warn a similar scenario could unfold downstate. The state’s request for applications explicitly asked bidders to model revenue scenarios based on one, two, or three licenses, suggesting flexibility in how awards might be structured. International precedents add to the caution. Japan began its casino licensing process with plans for three properties but has approved only one so far, for MGM Osaka.

External pressures complicate the picture. Rising construction costs, potential declines in tourism, and uncertainty around New York City’s upcoming mayoral election could weigh on final decisions. Democratic socialist candidate Zohran Mamdani, considered a frontrunner, has pledged not to block casinos but may push policies less favorable to developers. Meanwhile, New York’s tax rates—51% for mobile sports betting and up to 30% for casino gaming—are among the steepest in the country, raising concerns about profitability even for successful bidders.

This process seems designed to weed everybody out and hopefully get down to three in the end.

A Narrowing Field

With Caesars, Avenir, Wynn, and Las Vegas Sands now out of the race, more than $30 billion in potential investment has been sidelined. What remains is a contest increasingly defined by political maneuvering, community sentiment, and the state’s urgent need for revenue.

“There is definitely a chance this process ends with surprises,” said Brendan Bussmann, a consultant with B Global Advisors. “New York is a challenging market. The question is whether the process is designed to narrow the field down to three, or to keep everybody guessing until the very end.”

As the CACs continue voting through the end of September, the once-crowded race for downstate casino licenses has already thinned considerably—leaving stakeholders, developers, and local communities waiting to see just how many projects will make it across the finish line.