KUALA LUMPUR, Genting Group’s plan to sell the hotel and other non-casino assets at its Resorts World Catskills property in Sullivan County, New York, has been postponed until early January, once again delaying a planned US$561 million (RM2.37 billion) municipal bond sale.
The sale is being deferred as Genting Bhd (KL) seeks to buy out minority investors in its Genting Malaysia Bhd (KL) subsidiary, restricting the group from entering into new material transactions during the process. The update was disclosed in a letter by Resorts World US chief financial officer Walter Bogumil, which was read at a meeting of the Sullivan County Resorts Facilities Local Development Corp on Monday (Oct 20).
The development corporation had planned to issue municipal bonds to acquire non-gaming components of the resort — including hotel rooms, an event centre, spa, and golf course. The deal had already been postponed twice to address investor concerns.
A representative for KeyBanc Capital Markets, the lead arranger for the bond sale, declined to comment on the latest delay.
Market observers say investors have grown increasingly cautious toward high-yield municipal bonds following the financial difficulties faced by projects such as Florida’s Brightline high-speed rail. “Investors are finally becoming more concerned with some of the deal structures,” said Jeffery Timlin, managing partner and lead portfolio manager for Sage Advisory Services’ municipal strategies. “They want a little more protection.”
Genting, one of Malaysia’s largest leisure and gaming groups, is also a contender for one of three downstate New York City casino licences. The group has proposed a US$5.5 billion integrated resort next to the Aqueduct racetrack in Queens, competing against Bally’s Corp’s US$4 billion Bronx project and a US$8 billion proposal near Citi Field by Mets owner Steve Cohen.
Analysts have mixed views on the potential impact of new downstate casinos on Resorts World Catskills. Genting expects to redirect a portion of its urban customer base to the Catskills property, projecting an additional US$200 million in annual revenue. The company has pledged to channel some player rewards earned in the city toward visits to its upstate resort.
However, a separate report commissioned by Sullivan County consultants projects that the entry of three new casinos in New York City could cut Resorts World Catskills’ gambling revenue by as much as US$150 million, warning that “the viability of the resort as a major employer and economic anchor could be seriously threatened.”
Proceeds from the postponed bond sale were intended to strengthen the resort’s balance sheet, preserve jobs, and fund future development. Fitch Ratings noted that while the sale of non-gaming assets could enhance profitability from 2026 onward, rising competition from downstate casinos may eventually weigh on earnings.
