The company never got to actually break ground on the hotel because of regulatory and taxation changes in Kansas
Hollywood Casino in Kansas City is considering constructing a new hotel after years of delays. This would finally align the property with its vision to offer a resort experience near the Kansas Speedway racetrack.
The Hotel Might Finally Become a Reality
Hollywood Casino officially opened in 2012 and was set to start constructing its hotel two years later, in accordance with the development agreement with the Unified Government. However, the company never got to actually break ground on the hotel because of regulatory and taxation changes in Kansas.
Additionally, developers had cited studies suggesting that a new hotel in the area would cannibalize other hospitality properties in the vicinity.
The original idea for a $200 million 250-room hotel was put on hold, forcing Hollywood casino to pay millions of dollars in damages instead. As per the agreement, Hollywood Casino paid 1% of its annual revenue to the state in order to cover the unrealized tax growth. By the end of 2023, Hollywood Casino had paid over a dozen million dollars in such penalties.
Now a decade overdue, the hotel might finally become a reality as the casino management is considering a new construction plan. The decision to build a hotel now comes as Penn seeks an extension of its contract to keep running the casino.
It Is “The Right Time,” According to Casino Officials
The new casino plans were presented on Monday. Aaron Rosenthal, Penn’s senior vice president of regional operations said that his company thinks it is finally “the right time” to add a hotel to Hollywood Casino. He told the Unified Government’s Economic Development and Finance Committee that his team had never forgotten these plans.
It’s something we’ve contemplated since before the casino opened and something we’ve gone back to every year to determine the feasibility of. And for a variety of reasons, the feasibility for us had not made sense. But it does now.
Aaron Rosenthal, SVP of regional operations, Penn
The new proposal envisions a hotel with at least 125 rooms the construction of which would start by the end of 2026. As implied by the lower number of rooms, it would be half the size of the original hotel Penn planned to construct. However, the company noted that it would be possible to expand the property in the future.
Some of the pros of the new hotel are the hundreds of permanent and temporary jobs it would create.
Penn tried to negotiate a two-year penalty break until it began construction of the hotel but commissioners were uncomfortable with the idea.
