Group seeks deal with Cedar Rapids to purchase land for possible casino

If a statewide moratorium on new gaming licenses is lifted, the Cedar Rapids Development Group (CRDG) wants to make sure they’re first in line to purchase land for a new Cedar Rapids casino. At its meeting June 27, the Cedar Rapids City Council voted to approve preliminary terms of an agreement with the CRDG on an option for potential purchase of city-owned property on the west side of the Cedar River. A public hearing on the proposal is set for the council’s next meeting at noon July 11. Under the proposal, the CRDG would pay the city an option fee of $165,000 to retain the right to purchase city-owned property between F and I avenues NW and First and Fifth streets NW. Most of that property was previously occupied by the Cooper’s Mill restaurant and Best Western Hotel before those facilities were demolished due to damages sustained in the 2008 flood and the property was subsequently acquired by the city.

The option to purchase the property would extend through Dec. 31, 2025, but if the Iowa Racing and Gaming Commission were actively considering a Cedar Rapids casino application at that time, the option could be extended for another year at an additional cost of $55,000. Cedar Rapids development director Caleb Mason noted the city has an exclusive memorandum of understanding with the CRDG and the Linn County Gaming Association to develop a casino in Cedar Rapids. That memorandum extends through October 2029. State officials imposed a two-year moratorium in 2022 on consideration of any gaming license applications, but developers say they’ll pursue a license for Cedar Rapids when that moratorium expires in 2024. Under the terms of the agreement, the developer would be required to complete a 125,000-square-foot gaming facility that would incorporate restaurant space, event space and a gaming floor, no less than 1,500 parking spaces, and a minimum investment of $150 million. If approved, the land purchase option would include a number of other conditions to be met by the developer, including accommodating the city’s ongoing flood control project, paying the costs of relocating utilities if needed, and conducting a traffic study in the area. Other private properties near the city-owned land would also need to be purchased by the developer to accommodate the casino development. The council voted 5-1 to set the public hearing for the proposal, with council member Ashley Vanorny voting against the motion. Councilmember Tyler Olson abstained from the vote due to a potential conflict of interest, and council members Scott Overland and Marty Hoeger were absent. Linn County voters approved a measure in November 2021 that allows developers to seek a casino license for the county in perpetuity. Back in May 2022, developers and supporters unveiled plans for a casino dubbed Cedar Crossing. As proposed, Cedar Crossing would incorporate Iowa’s 20th state-licensed casino, as well as bars and restaurants featuring celebrity chefs. The Cedar Rapids Development Group (CRDG), a group of nearly 100 local investors, Peninsula Pacific Entertainment (P2E), a national gaming operator and developer, and the Linn County Gaming Association (LCGA), a local nonprofit association, would jointly apply to the Iowa Racing and Gaming Commission (IRGC) for a license for the new facility. The IRGC has twice rejected casino proposals for Linn County, in 2014 and 2017, after commissioners largely sided with opponents who argued the state’s gaming market was saturated and a new Linn County casino would “cannibalize” revenue from existing state-licensed casinos. However, that commission now has new members, raising hopes that opinions on a Cedar Rapids casino could change. “P2E believes the 125,000-square-foot facility, which includes a 1,500-capacity entertainment venue, will be an important element to the community’s economic development and revitalization,” P2E officials said in a statement. “Peninsula Pacific Entertainment has a proven track record of development, and we have been invested in Linn County from the very beginning.  We are unwavering in our commitment to bring gaming to Cedar Rapids and Linn County. While the moratorium was truly punitive to city leaders and the business community who are focused on infusing capital and investment into downtown, Cedar Crossing will be the best gaming and entertainment center in the nation.”