Las Vegas-based giant MGM Resorts International’s bid to build a full scale in New York ended this week in dramatic fashion, as the company announced it would be pulling out of the running for one of two coveted downstate NY licenses due to be given early in 2026. The decision sparked much discussion and market reaction to the news was drastic, before settling down.
MGM’s decision was officially due to the licensing terms being cut from 30 years to 15 years. The operator already runs a limited-scale NYC gaming venue, Empire City games in Yonkers, but it was looking to spend several billion on upgrading it to a full Las Vegas-style resort. Its bid was one of four out of eight licenses submitted that were recently approved by the city for further consideration. However, speculation is rife as to some other reasons for MGM’s last-minute reversal.
License Term Reduction Spooked MGM
The largest US gaming operator MGM said that circumstances had changed since it submitted its initial application in July. The operator was thought to be among the favorites for one of the three licenses prior to the competition beginning in earnest, mainly due to its existing venue in New York.
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One specific change that MGM flagged was the recent shortening of the expected standard license term from the 30 years bidders had anticipated under earlier guidance to a 15-year term. It also pointed out that all four remaining competitors were very closely located to each other in the Queens borough of NYC, as opposed to a variety of downstate locations represented across the field previously.
MGM’s Stock Saw Major Rebound and Then Equalized
Markets moved quickly in response to the news. The first reaction was undoubtedly positive, with MGM’s shares jumping some 4% up in the day following the announcement. Analysts and think pieces considered the sudden release of a previously expected several billion in capital investment for the project as a net positive for the operator.
However, share prices eventually settled at a lower level, around 3% up from before trading. Overall, MGM Resorts’ shares are still slightly down – around -2.3% – over the past 12 months. A troubling global economic outlook and a sharp downturn in Las Vegas visitation has spooked many investors, although MGM’s ever-growing online arm has seen others remain confident.
MGM’s shares have been volatile over this period, with 10 days where share prices moved more than 5%. This indicates that investors did react to the New York project cancellation, but it wasn’t anything out of the ordinary for the company overall.
The divestiture of a potential multibillion dollar future investment will free up cash flow, usually a good look for its investors, as will the recently announced $500 million sale of its MGM Northfield Park resort in Ohio.
Who Are the Three Remaining Applicants?
MGM’s shock departure leaves just three projects in the running, from a field that at one point had more than a dozen proposals. The remaining options being considered by New York officials include:
- Metropolitan Park in Queens, a development led by New York Mets and Citi Field owner Steve Cohen
- Bally’s at the former Trump Links Golf course site in the Bronx
- Resorts World New York City – a planned expansion of Genting’s existing limited in Queens, backed by local rap legend NAS
Resorts World – due to its existing venue – was considered a favorite prior to the real start of the race. However, controversies over money laundering at owner Genting’s Resorts World Las Vegas game led some to think it might have dropped down the list. But, it’s still here.
There are now three licenses to give out, for just three applicants. Potentially, this should make the license process much simpler – but officials have remained tight lipped on whether all three licenses are required to be given out at this time. The final decisions are expected to be made in early to mid 2026.
Links to President Trump Questioned Ahead of Final Decision
In an interesting turn of developments with this story, since MGM dropped out of the race some have questioned the move’s relationship to Bally’s contract with President Donald Trump. If Bally’s is chosen to build one of the multibillion-dollar gaming projects, the President, or at least the Trump Organization that he and his family own, stands to benefit from $115 million extra from the sale of its former Trump Links golf course in the Bronx.
Yonkers Mayor Mike Spano specifically called on New York Governor Kathy Hochul to investigate MGM’s withdrawal. He said he believed the Nevada gaming giant’s reasoning behind dropping out at such a late stage did not add up and that authorities should determine if the Trump organization was at all involved in the decision.
The winning firms will have to pay $500 million for a license, and all three remaining competitors have promised tens of millions of dollars in community benefits on top of the multibillion-dollar gaming builds themselves. The Citi Field development has several blocks of public housing attached, and Bally’s even put aside several million to fund a historic but struggling convent school in the Bronx as part of its bid to woo regulators and local opinion.
