A rendering of the forthcoming waterfront casino to be built in Norfolk, Va. A city press release said the casino, projected to be completed in September 2027, would generate 584 direct jobs, 124 indirect jobs and what it called 117 induced jobs with wages and salaries of more than $58 million. (Image courtesy Boyd Gaming Corp.)
Norfolk’s City Council on Tuesday voted to move forward with a new developer for a long-delayed riverfront casino project dramatically smaller than the proposal floated when voters overwhelmingly approved a referendum in 2020.
Jon Yarbrough, the Tennessee billionaire who promised a resort with a soaring 10-story glass hotel tower, casino, marina, and restaurants five years ago through Golden Eagle Consulting, the firm he financed, is out as the development partner with the Pamunkey Indian Tribe.
Who’s in: Boyd Gaming , the new majority owner of Golden Eagle Consulting, a Nevada-based company with 28 mid-sized casinos and $3.75 billion in annual revenue.
The council also amended a purchase agreement for the property next door to the city’s minor league baseball park and Amtrak station to sell 9.35 acres for $10.5 million. A vote to sell the property will take place next month.
“We can’t beat this deal,” said council member Tommy Smigiel. “I wish there were more people that are willing to just give us money and not ask anything back from us.”
City manager Pat Roberts said the casino, hotel and restaurants would yield $30 million in local tax revenue annually. A city press release said the permanent casino, projected to be completed in September 2027, would generate 584 direct jobs, 124 indirect jobs and what it called 117 induced jobs with wages and salaries of more than $58 million.
The agreement approved Tuesday outlines only the minimum $300 million investment required by state law, a 150-room hotel, 25 gaming tables and 750 “electronic gaming machines.”
City officials say the project will be bigger. Boyd submitted a proposal to the city’s Architectural Review Board last month for a 200-room hotel that resulted in two pages of recommended changes. Only a couple of those were made by this week’s meeting. The board continued a vote. In a press release, the city said the Boyd casino would have 50 gaming tables and 1,500 slot machines. According to the agreement, the tribe will have a 20% stake in Golden Eagle.
Council member Andria McClellan, who has long opposed the casino, was the lone dissenting voice. “We’ve been dealt a bad hand,” she said, noting the agreement obligates Boyd only to the minimum state required investment of $300 million, not the $700 million luxury resort promised voters in 2020.
“The feedback from my constituents suggests that if we were to revisit this casino referendum today, five years later, it wouldn’t pass,” she added.
The agreement also provides for Golden Eagle to pay up to $7.5 million for construction of a floodwall along that portion of the Elizabeth River, part of the city’s $2.66 billion storm risk management project with the U.S. Army Corps of Engineers. The original agreement required the developer to pay for flood protection and infrastructure but did not have a cap. The city amended the proposed purchase agreement by removing six acres that would have included a marina because it’s needed for the floodwall and adding another acre at Boyd’s request.
Last summer, Norfolk signaled frustration with Yarbrough and a proposal to create a phased construction plan with an initial $150 million investment for the casino in a letter from Roberts. Council members were briefed in a closed session about their options to seek other partners. Norfolk, which had been the first to reach a casino deal with the Pamunkey, watched as casinos in Bristol, Danville, and Portsmouth licensed by the state signed local agreements and opened. The three reported July revenues of $59 million with $3.5 million going to the three cities.
The move to a smaller project reflects the urgency to reach an agreement and begin construction so the casino can open by November 2025, when the referendum approval expires. To meet the construction start deadline, Boyd will build a temporary casino in a 7,200-square foot “sprung structure” — essentially a fancy tent — by November 2025, with construction of the casino scheduled for completion two years later.
Norfolk officials have long said a phased project was unacceptable. They denied that the plans for a temporary casino are phased.
“We will approve one building permit, and that building permit may have an initial or transitioning building to preserve the license,” Mayor Kenneth Alexander said after the meeting.
He added that Norfolk couldn’t turn down a revenue-generating project requiring no city investment. With other lodging projects in recent years, he added that Norfolk no longer needed a 500-room hotel.
The revised agreement acknowledges the latest shrinkage of a project originally proposed in 2019 first as a $700 million resort with a 500-room tower, high-end restaurants, a 750-seat entertainment venue, a marina, and three to five restaurants and later as a $500 million resort. That proposal said the casino would have 3,500 to 4,500 slot machines and 100 to 225 table games. A chart projected gaming tax revenue alone to the city at the highest number of slots and table games to be nearly $33 million annually.
But that was before Rivers Casino opened in Portsmouth in January 2023 with 1,446 slot machines, 57 table games, and 24 poker tables. It has a 1,000-capacity entertainment space that hosts concerts and five restaurants , including a high-end steakhouse. It does not include a hotel. Under Virginia law, 6% of a casino operator’s adjusted gross revenue (earnings after winnings) is paid to the host city, up to $200 million for the year then rises to 7% up to $400 million. Rivers generated $15.4 million in gambling tax revenue for the city in its first year.
Being first was one focus of a September 2019 memorandum to City Council members from then city-manager Larry “Chip” Filer.
“Best case scenario is that by being the first mover, Norfolk generates substantial barriers to entry resulting in the Pamunkey casino being the only regional casino,” he wrote. “In the event other casinos decide to enter the market, the first-mover advantage is still highly valuable as the Norfolk casino would lead the way.”
Now, a Norfolk casino would be a runner-up in the revenue race. Robert McNab , chair of the department of economics and director of the Dragas Center for Economic Analysis and Policy at Old Dominion University, said Norfolk would be at a disadvantage, especially if it doesn’t offer more gaming opportunities than Rivers Casino.
“The challenging thing for Hampton Roads has always been that you’re going to position two casinos essentially adjacent to each other. We know from the casino literature and practice that most casinos draw from within a two-hour area,” he said. “So if you have two competing casinos sitting in the same space, competing with each other, it really is a competitive environment that doesn’t favor smaller casinos.”
He noted also that the competition would not only come from Rivers Casino, but online betting as well.
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“One of the things casinos always have to consider, and why the number of casinos has remained relatively stable over the last decade in the United States, is that the competitive environment for gambling overall is just becoming more crowded and more intense because you and I can now sit on our phones and bet on whether the next snap, the next pass, the next touchdown occurs in 30 seconds.”
McNab predicted that Norfolk’s casino would generate revenue for the city, but the bulk of it would come from “other entertainment functions across the region.”
“Will this lead to a boom in terms of additional jobs in Norfolk? Probably not. We haven’t seen similar effects in Portsmouth and other places,” he added.
Alexander disagreed.
“You’ll have in Norfolk a facility that not only includes a gaming floor, but food and beverage, hotel, and other experiences,” he said. “You will attract your high rollers. So the whole programming, the entire programming of the Norfolk casino, it’s much different.”
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