Freedom Plaza is big and bold, but casino remains a sticking point

Two pillars of the American dream are free capital markets and bold economic ventures, especially in an iconic setting like Manhattan, and such is the ethos of Freedom Plaza, the sprawling $11 billion mixed-use casino bid from Soloviev Group and Mohegan Gaming.

The project is located within walking distance from the United Nations headquarters in Midtown. Freedom Plaza is one of eight downstate New York casino proposals jostling for three available casino licences to be awarded this year. It is perhaps the most ambitious project of the field, and sports the highest price tag. Its pledged total of 17,000 combined construction and permanent jobs is also the largest of any proposal.

If selected, Freedom Plaza would transform a 6.7-acre plot along 1st Avenue into a small community. Plans include a casino, two hotel towers, two residential towers, a so-called Museum of Democracy, and nearly five acres of public park. Soloviev CEO Michael Hershman said in a presentation on Thursday that the parcel is “probably the largest piece of undeveloped property in Manhattan”.

Hershman’s comments came before the first public hearing for the project at Scandinavia House. The five-hour hearing was organised by the bid’s community advisory committee, tasked with gauging the public support for the proposal. Four of six committee members must vote to approve the project for it to advance. The next hearing is scheduled for 15 September, and the vote deadline is 30 September.

Approximately 140 speakers were heard by the CAC, encompassing trade groups, potential vendors and local residents. Supporters touted Freedom Plaza’s litany of benefits and amenities; many residents did too, questioning why a casino was then necessary.

Pivotal project for Soloviev, Mohegan

Prior to public comment, Hershman was joined in his presentation by Mohegan CEO Ray Pineault and other stakeholders. Stefan Soloviev, the eccentric heir to the company founded by his father, Sheldon Solow, was not present. Hershman pledged Soloviev would try to attend the second hearing.

“We’re not Las Vegas and as I said, we’re not Hollywood,” Hershman told the crowd. “Because we have children and grandchildren that live in the neighbourhood, we want what’s best for the neighbourhood as well.”

The site was purchased by Soloviev in 2007. For a century prior, it had been an industrial plant for Con Edison. Soloviev demolished the plant and spent millions cleaning the contaminated site. Solow proposed a development plan for the area in 2008, which never materialised. Freedom Plaza is the reincarnation and adaptation of those plans.

Among the proposed benefits is a public equity offering, also being proposed by Bally’s Bronx. Bally’s just closed on a similar public investment programme for its Chicago casino, which could chart a roadmap for such efforts in New York.

“We also, as you may have heard, are setting aside, in a preferred fashion, equity for community members, community members being residents of New York City as well as New York City pension funds,” Hershman said.

For Mohegan, Freedom Plaza represents a crucial expansion opportunity. The company’s Mohegan Sun casino is incredibly successful, but its Korean resort was seized by creditors in February and its operating contract for Virgin Las Vegas was not renewed last May. New York could be a reset opportunity for the tribal-owned outfit.

“We’re not a corporate board that’s worried about our next earnings call,” Pineault said. “We’re worried about what’s best for the organisation for 13 generations to come.”

Substantial parkland, on-site housing among key benefits

Two of the most-hyped aspects of the project are its housing commitment and its park space. There are just more than 1,000 residential units planned across two towers. Of those, 513 are deemed affordable based on different incomes. This 50% affordability rate was lauded by stakeholders, as the original 2008 site proposal was 100% market rate. It is the only New York casino bid to include housing within the project itself.

“I think I heard of another [bid] that was promising to do housing off-site, maybe another one that was promising to do housing over the next 20 years. We do not need more housing over the next 20 years, we need housing right now,” said Jamie Smarr, CEO of the NYC Housing Partnership and a member of the project team.

Smarr was referring to the Avenir and Resorts World NYC bids. Avenir is proposing housing units at buildings spread throughout Manhattan. Resorts World is pitching tens of thousands of workforce housing units to be built in the coming years.

With regard to parks, it was noted several times that Community District 6, which encompasses the site, is near the bottom for parkland and tree coverage in the borough. At just under five acres, Freedom Plaza’s parks would be a massive addition to the community.

“Just to put that in perspective, that’s very similar in size to Bryant Park,” said Nelson Parker, Mohegan’s chief strategy officer. “It would be very well maintained, landscaped, secure, lit, private funded, we’ll do all of that.”

As the most ambitious project economically, it was not surprising to see a large contingent of trade and community leaders show their support for it on Thursday.

“When I walk past it every day, all I see is a hole in the ground,” said Local 3-affiliated electrician Steven Fraser. “I can’t imagine a better project for that space.”

Three of the eight bids are Manhattan-based (Freedom Plaza, Avenir and Caesars Times Square). In Freedom Plaza’s case, a commitment of 17,000 total jobs would offer new opportunities for workers across the city, not just the immediate area.

“I urge you to weigh not only the economic development and environmental impacts, but also the profound human impact this project delivers,” said Nelson Gonzalez, on behalf of the HOPE employment program.

The project’s connection to the UN and its high-value international tourism is a selling point. Las Vegas is currently grappling with a visitation decline and US President Donald Trump’s trade policies have bristled some would-be international travellers. But world leaders could be amenable to a luxury stay during the UN General Assembly, held every September. This year’s session starts on 9 September.

“Everybody in this room will agree with me that the worst week to be in Manhattan is UN General Assembly week, with the congestion and everything,” argued attorney Alex Estes. “Would it not make sense to have a hotel for the world leaders to stay at directly next to the UN and then take away the congestion from the rest of Manhattan?”

Buttressing this point was Mike Balboni, a homeland security advisor to the state. His view was that the “great confluence” of security forces would provide “deterrence and detection and protection”.

Casinos and national security concerns

Others were unconvinced of the security pledges, both in regard to general casino crime as well as potential international incidents.

“We don’t want it, it is next to a terrorism target,” said local resident Stacey Roush. “The UN, putting a casino with open space is like, ‘Come, send me a drone with a bomb!’”

While perhaps hyperbolic, Roush does highlight a concern related to casinos and national security. For multiple years there have been efforts to bring a casino to Tysons, Virginia. Tysons is a suburb of Washington, DC that is densely populated with federal employees and contractors.

In January, 109 security officials sent a letter to Virginia lawmakers calling a Tysons casino “an unacceptable health and national security hazard“. This group of signatories included former Congress members, CIA officials and Defense Department leaders. Compulsive gamblers can be extorted or blackmailed by bad actors, which is especially worrisome for government employees, they wrote.

Ain’t no love in the heart of the city

Residents in the immediate vicinity of the project were largely opposed. With some exception, this has been the general theme for nearly all New York casino hearings held thus far. Accusations of paying for endorsements and denying hearing entry to opponents were cited on Thursday and have been common throughout proceedings.

Prior to the start of the state process in late June, each project was considered by local community boards. These boards gave non-binding votes that were expected to play a role in future considerations. Manhattan’s Community Board 6 rejected land-use provisions for Freedom Plaza in early 2024.

“We passed resolutions in opposition to this casino, because behind their fancy spin is a truth that we all know: this project is wrong for our neighbourhood, wrong for our families and wrong for the future of east Midtown,” testified Kyle Athayde, former chair of CB6.

The range of proposed amenities was lauded by many detractors. Community members stressed they were supportive of housing, parkland and museums. Why, then, must a casino be included? The phrase “just not a casino” or similar variations were common throughout.

“I also find it very interesting that they’re proposing a Museum of Democracy, but when I walked in here today I was not allowed to use my sign and I was told to put it away,” said resident Dawn Heimer.

Her sign, unfurled for the committee, was bright red with the words: “Say NO to the casino!”