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August 17, 2019Cart

Business

by Fairfield County Business Journal
by FCBJ

Resort casino is latest gamble for Bridgeport’s Steel Point

A view of the Steelpointe Harbor area on the Bridgeport waterfront. Photo by Phil Hall

In September, MGM Resorts International unveiled a proposal to build a $675 million luxury hotel and casino complex in the Steel Point section of Bridgeport. The announcement was not a total surprise, as three months earlier, MGM Resorts International Chairman and CEO Jim Murren, a native of Bridgeport, said in an op-ed column that “Bridgeport has always been on our radar screen” for an MGM-branded casino but was not previously pursued because the state limited gaming to tribal lands.

Murren set a 2021 opening for the Bridgeport project, which will require a change in state law to accommodate a nontribal gaming venue.

The MGM Resorts project marked the latest chapter in a long, complex and frequently frustrating effort to transform Steel Point from a troubled corner of the city into an economic powerhouse that would fuel both Bridgeport and Fairfield County. For decades, Steel Point was the subject of grand announcements of development projects, but its progress has been mostly measured in fits and spurts.

A 52-acre peninsula on Bridgeport’s eastern edge, bounded by the Yellow Mill Channel, the Pequonnock River and the Long Island Sound, Steel Point was established as a center of shipbuilding operations in the 18th and early 19th centuries. Manufacturing began to take root in the mid-19th century; the name “Steel Point” derives from the two steel works that operated there until the early 20th century, when the area began to transition into a working-class residential neighborhood dotted with marinas and light manufacturing plants.

By the early 1980s, Steel Point was in decline with the loss of manufacturing jobs and a growing crime rate. Bridgeport Mayor Leonard Paoletta proposed a development strategy for the area as part of an $800 million program that would reanimate Bridgeport’s more depressed communities. The Republican mayor also proposed giving Steel Point a new identity by calling it Harbor Pointe.

But with a succession of mayors and with the city facing severe fiscal problems that forced it to file for bankruptcy protection in 1991, the Steel Point plans were shelved. In 1993, Democrat Joseph Ganim was elected to his first term as mayor and sought again to reinvent Steel Point.

Bass Pro Shop, the first retail outlet to open at Steelpointe Harbor. Photo by Phil Hall

Initially, Ganim conferred with casino owners Donald Trump and Steve Wynn about the possibility of developing Steel Point as a casino site, but nothing came from those discussions. In 1998, however, the Connecticut General Assembly approved a $200 million plan to turn the Steel Point area into an entertainment and retail complex called Harbor Place. The state and the city selected Greenwich-based Conroy Development Co. to coordinate the project.

Conroy raised $700 million for the project, which was to include a 1.5-million-square-foot mall with IMAX theater and a hotel. Alexius C. Conroy, the company’s president, forecast the start of construction in the summer of 1999, following the city’s acquisition by eminent domain of 270 homes and several privately owned businesses at Steel Point.

But the property purchases took longer than expected, delaying the start of the development. Ganim in early 2000 canceled the city’s agreement with Conroy Development and selected a Bridgeport contracting firm, United Properties, to develop a 450,000-square-foot commercial and residential complex at Steel Point.

United Properties’ owners, Alfred Lenoci Sr. and Alfred Lenoci Jr., later admitted gaining favor for the deal by paying ”consulting fees” to Paul J. Pinto, a Democratic Party fundraiser and Ganim ally, at a rate of $1 for each square foot of commercial space to be built at Steel Point.

Conroy filed a lawsuit in U.S. District Court in 2001, accusing the city of racketeering and unfair trade practices. The lawsuit eventually brought down Ganim, who resigned in April 2003 after being convicted on 16 counts including racketeering, bribery, extortion and mail fraud. Ganim, the Lenocis and Pinto were sentenced to prison terms and Conroy Development received a $4.5 million settlement.

In September 2002, while Ganim was still in office, Bridgeport announced a new developer for Steel Point, RCI Marine of Miami Beach. The Florida company specialized in waterfront developments along the East Coast and in California. According to a New York Times report, RCI Marine’s plans included the creation of “a 4.85-million-square-foot complex of about 600 rental apartments in several low and midsized buildings; two hotel towers joined to a conference center; 1.6 million square feet of offices; 153,462 square feet of retail space and restaurants; garage and surface parking for up to 6,000 cars; a town square and lighthouse; a marina for 375 boats; a 50-foot-wide boardwalk along the water; a movie theater; and possibly a heliport.” City officials gave the project, soon to be dubbed Steelpointe Harbor, a build-out period of 10 to 15 years and estimated its cost at about $850 million.

Fifteen years later, only four retail stores operate on the planned site of Steelpointe Harbor, surrounded by large patches of empty land.

“When we made our request for proposal, the city said the property was all in place,” said Robert W. Christoph Jr., founder and president of RCI Marine. “It was not.”The city had only acquired 35 acres of the 52 total acres at Steel Point through eminent domain.

After the last commercial occupant vacated the site in 2009, Steel Point remained stagnant until July 2012, when Bass Pro Shops, the fishing and sports retailer, announced plans to open a 150,000-square-foot store in 2013. Construction did not start until December 2014, after the state issued $22 million in tax-increment financing bonds and $9 million in general obligation bonds to help cover construction costs.

Bass Pro Shops opened in 2015 and was followed that year by the arrival of Starbucks, Chipotle and T-Mobile stores on a commercial property opposite the sporting goods retailer. But that same year, announced plans for a Hampton Inn hotel and a Cinepolis movie complex at Steelpointe Harbor fizzled before agreements were finalized

With Ganim’s return to the mayor’s office in 2015, Steel Point again became part of his economic development focus.

In May, Bridgeport Landing Development, the RCI Marine subsidiary coordinating the Steelpointe Harbor project, held a groundbreaking ceremony for a three-story DockMaster building and a public harbor walk. The 35,000-square-foot property, scheduled for completion in the second quarter of 2018, will include a restaurant, office space and residential units. “The end product is going to be nothing short of magnificent,” said Ganim at the groundbreaking.

At RCI Marine, the slow pace of development in Bridgeport has not deterred the developer.

“Our philosophy is that we go in with a long-term approach,” said Christoph. “We have a real love for Bridgeport, and we believe that it will rival any city in the next five years. In recent years, we’ve seen Norwalk grow stronger and Stamford grow stronger, and now it is Bridgeport’s turn to shine.”

Keith Williams, president of the East End Neighborhood Revitalization Zone in Bridgeport, was also willing to overlook the slow progress. “We didn’t expect it to happen overnight,” he said. “You’ve got to keep throwing your hopes out there until something catches.”

But Jeff Kohut, a Bridgeport-based writer and political activist who ran for mayor in 2011 as an independent, said the Steel Point redevelopment effort has created more problems than solutions, especially in view of the residences and businesses that were removed without any immediate evidence that something better would take their place.

“It was a painful thing for a lot of people and, so far, it not has borne the fruit,” he said. “In terms of what they want to put there, I am not certain if that can justify it.”

If the state gives MGM Resorts the green light to build a Bridgeport casino, Kohut said, that project might be the long-needed spark to light Steel Point’s rebirth. “At this point in time, because there is nothing knocking at our door and there’s nothing else we can bring in at such short order, I think the positives outweigh the negatives,” he said.