Myriad Entertainment & Resorts, Inc.(fka MYRA)

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http://memphis.bizjournals.com/memphis/stories/2007/09/03/story11.html

Friday, August 31, 2007

Myriad changes strategy; now plans to build casinos, hotels in phases.

Construction on the much-discussed Myriad Botanical Resort in Tunica could begin as early as the first quarter of 2008.

Since the project was first announced in 2004, its cost has grown to an estimated $4 billion.

Nick Lopardo, chairman of the board of Myriad Entertainment & Resorts, Inc., says the project has now been divided into phases. The first phase will have either two 80,000-square-foot casinos and two 500-room hotels or one 160,000-square-foot casino and a 1,000-room hotel. It will also include a 150,000-square-foot convention center with a 600-room hotel attached. Lopardo says the first phase will include the golf course, which will have the first and last holes covered instead of the entire course, a water park and a snow/ice park.

An added twist to the first phase is a 6,000-seat arena or stadium with an ultimate goal of attracting a minor league sports team. Lopardo currently owns the Independent League North Shore Spirit, a Massachusetts-based minor league baseball team.

The first phase's budget will be $1.3 billion, although funding remains a key issue for the project.

Lopardo says an initial fundraising goal of $200 million is moving forward. The project has received state entitlements from Mississippi totaling nearly $290 million in sales tax rebates and a Public Improvement District classification, which will issue $200 million in bonds for the infrastructure work.

Lyn Arnold, executive director of the Tunica County Chamber of Commerce, says the bond money depends on how many bonds get sold on the open market and the sales tax rebates only kick in when the facility is open.

"They don't get a dime until the facility is up and running and that comes back from sales tax on non-gaming entertainment," Arnold says.

The tax rebates are part of a tourism incentive bill that allows companies to get sales tax rebates of up to 30%.

"It's a nice incentive, but you've got to produce to get it," she says.

Lopardo says the company is still working with investors on raising the funds for the project, but declined to say how far along the process was.

"The critical part is the equity raise," Lopardo says. "We hope to be in a position to consummate that before the land contract expires, and we're confident we'll come up with the equity for the project."

Lopardo says the recent extension Myriad filed on its land acquisition date should allow the land acquisition to be finalized by Oct. 2. It was originally set to close in August, but an extension was granted until October. The purchase price is $25 million in cash and 6.5 million shares of restricted company stock.

He says after another three or four months of permits, infrastructure work could begin early next year, with "vertical progress" possibly being seen by next spring. Construction of the first phase is estimated to last 36-40 months.

"We haven't changed the original plan. We just don't want to build or fund everything at the same time, because we don't think that's reasonable," Lopardo says. "The only thing we're not doing is building four other casinos or hotels and we're not building one or two activity centers. That will still come in future phases."

Lopardo says previously announced plans to sell plots of land to select Native American tribes have been canceled.

"We want to continue to control our brand and site as well as economics of ownership in the casinos and hotels," he says. "That's more profitable than selling those, but as we get into the phase, that could change as well."

Webster Franklin, CEO of the Tunica Convention and Visitors' Bureau, says Myriad's new plan seems more realistic and manageable than what was originally proposed.

"With their plans, they can spur the growth we need," Franklin says. "It'll be very good for the tourism and casino market to expand at the same time."

Lopardo says even though the initial phase won't be as grandiose as originally envisioned, it will still change the landscape in Tunica.

"Building six (casinos) at one time isn't appropriate for the marketplace because it couldn't be funded and the capital market couldn't handle funding it," Lopardo says.