Pinnacle plunks down big investment on downtown projects

2012-12-12T00:07:00Z 2015-04-28T22:09:17Z Pinnacle plunks down big investment on downtown projectsBy Tim Logan 314-340-8291

ST. LOUIS • When Pinnacle Entertainment won the city’s blessing in 2004 to build its glitzy Lumière Place casino on Laclede’s Landing, it pledged to invest in $50 million worth of downtown real estate.

It made good on that pledge Tuesday — in a manner of speaking.

City officials and the Las Vegas-based casino company have agreed on a series of investments in downtown projects that will, said development chief Rodney Crim, “extinguish” Pinnacle’s responsibilities to the city.

The investments include:

• A $6 million contribution to the National Blues Museum being built on Washington Avenue.

• A $5 million donation over three years to CityArchRiver for improvements to the Gateway Arch grounds.

• Donating to Great Rivers Greenway a riverfront parking lot for which Pinnacle paid $7 million.

• Donating $500,000 over five years to the St. Louis Police Department to fund “supplemental police activities,” potentially “hot-spot policing.”

Those amounts, along with a $2.6 million investment in a building on Cass Avenue on the near north riverfront and $2 million spent on casino parking lots, satisfy Pinnacle’s obligations, Crim said.

“These are significant projects for the city,” he said. “We wanted to stimulate development along the riverfront, and these will help do that.”

But they do not add up to $50 million. And they don’t have to.

The language in Pinnacle’s agreement requires $50 million in capital spending “by Pinnacle and/or its development partners.”

Even though Pinnacle is donating only $6 million for the museum, for example, the entire $14 million cost of the project counts toward the total. That also goes for the full $10 million cost of the building on Cass.

For the massive CityArchRiver project to redevelop the Arch grounds, Crim said, the city and the casino “just settled on” $16 million worth of credit toward the $50 million total.

The investments were due by the five-year anniversary of the opening of Lumière, which is coming up this month. Had Pinnacle not made them, it would have owed the city $1 million in fines. Earlier this year, the company’s senior vice president for St. Louis, Neil Walkoff, had said Pinnacle might simply pay the fines.

But the company found some good investment partners and saw an opportunity to help the city and boost tourism, said Jeff Babinski, general manager of Lumière Place.

“We felt this would be a great benefit to the city,” he said.

It’s a far cry from early proposals Pinnacle made while Lumière was under construction, a time before the recession, when then-chief executive Dan Lee envisioned a neighborhood of condominium towers and high-end retail between the casino and the riverfront.

Still, the money is appreciated by the groups that are receiving it.

“We’re just thrilled,” said Susan Trautman, executive director of Great Rivers Greenway, which hopes to raise the level of Lenore K. Sullivan Boulevard and use Pinnacle’s parking lot along Wharf Street to help connect the Arch grounds and its north riverfront trails. “It’ll be a space where we can do fun things. I don’t know what it’ll be yet, but we plan to ask the public what they’d like to see there.”

Any redevelopment of the site, though, is still in early planning stages, dependent on April’s planned public vote to raise sales taxes for park funding.

A little further along is the National Blues Museum, in the ground floor of the Laurel building on Washington Avenue. Organizers hope to open the 23,000-square-foot museum next year, and are preparing to launch a fundraising campaign.

Pinnacle’s contribution is a good start, and one that should encourage other potential donors, said Rob Endicott, chairman of the museum’s board.

Pinnacle also amended its deal with the city to reduce the number of slot machines at Lumière Place to 1,500 from 2,000, and increase table games to 60 from 40.

While slots are often more profitable than table games at regional casinos, that’s not necessarily the case at Lumière, Babinski said, because its clientele is more tourists and sports fans than most casinos. The switch has been approved by the Missouri Gaming Commission and will take place early next year.

Babinski also said Pinnacle is considering renovations at its Hotel Lumière on the casino property but said no final decisions had been made.

Tim Logan is a business writer at the Post-Dispatch. Follow him on Twitter @tlwriter.

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