Betting on Edgewater

After nine years of trying, the Havenick family, which owns Magic City Casino in Little Havana, has gained the right to seek city approval for a jai alai fronton, a poker room and maybe some sports betting at 3195 NE 2nd Ave. The proposed location, which spans two lots in Miami’s Edgewater neighborhood, is an area where high-end high-rises are sprouting like kudzu.

Under a settlement agreement approved by the Miami City Commission on April 8, that jai alai fronton and poker room can move forward with a simple majority vote, rather than the four-fifths vote required by city ordinance. The Havenicks can also seek permission to act as sports betting bookies if that activity is legalized by the state; however, that approval would require the usual four-fifths vote from the commission.

What the agreement will not allow in Edgewater are most bank games, like blackjack, roulette and dice. (Designated player poker games, like pai gow poker, where players gamble against the dealer, are allowed.) Slot machines, which anti-casino advocates often describe as the crack cocaine of gambling, are also not permissible. Magic City Casino – formerly Flagler Dog Track & Entertainment – offers 800-plus slot machines along with jai alai and poker.

In addition to the City of Miami, the agreement includes individuals and other entities that attempted to stop Magic City’s Edgewater venture through litigation: billionaire automotive dealer Norman Braman; developer The Related Group; the Brickell Homeowners Association and its president, Ernesto Cuest; the Morningside Civic Association; and retired Judge Ronald Friedman.

Braman said the agreement prevents a full-fledged casino from opening in Edgewater.

“The agreement reached … allows a summer jai alai and card room, nothing else. I’m satisfied,” Braman said.

But what about sports betting?

“That has to go before the voters,” Braman replied.

In 2018, 70% of Florida voters passed a constitutional amendment requiring statewide voter approval on expansion of gambling, except for betting on jai alai games and horse racing.

However, a 75-page compact between Gov. Ron DeSantis and the Florida Seminole Tribe may provide a loophole for sports betting without a referendum, since casinos like the Seminole Hard Rock Hotel in Hollywood, Fla., are located on reservations. Under this gaming compact, which the Florida Legislature is scheduled to vote on during a special session starting May 17, the Seminoles would be allowed to partner with parimutuels like Magic City for sports betting in poker rooms outside of tribal lands.

Defense Mode & A Strong Opposition

The agreement with the Havenicks allows for construction of a facility in Edgewater with up to 100,000 square feet of exhibition space, a jai alai fronton with up to 4,000 seats, a poker room with a max of 500 seats and a parking garage with up to 1,000 spaces.

Isadore “Izzy” Havenick, vice president of Magic City Casino, said that with the litigation, the pandemic and tracking various gambling bills, his family is still finalizing its plans for a gambling facility.

“As soon as the legislative session is over,” said Havenick, “we will sit down, start meeting with the architect and go from there.”

Havenick, who said he’s been traveling between Miami and Tallahassee during this legislative session, declined to comment on the state’s Seminole gambling compact.

While cautiously optimistic, he admitted he’s also wary that something else may come up to prevent his family from constructing a gambling venue in the midst of hundreds of luxury condos.

“Honestly, because of everything that has happened, we are now in defense mode always. Because every time we have done everything right, something has happened to change the goal posts,” Havenick said.

Indeed, the Havenicks have many opponents in the Biscayne Corridor. Dozens of residents, mainly in Edgewater, have either spoken out at public city meetings or written letters to the city against the construction of a gambling parlor in their neighborhood. Andres Althabe, president of the Biscayne Neighborhoods Association, noted that Miami City Commissioner Ken Russell was the lone vote against the settlement agreement. Russell’s district includes Edgewater.

“The mood of my neighbors is that they don’t understand how four commissioners from different districts that are not [directly] affected can make a decision that will affect this neighborhood,” Althabe said.

Apart from worries about the impact gambling might have on Edgewater, Althabe said the area simply can’t accommodate any more development. For example, at nearby 2900 Biscayne Blvd., a 39-story high-rise with 588 apartments and a supermarket called Nema Miami is being built by Crescent Heights, a real estate development company that is purchasing property throughout the Edgewater area. Crescent Heights also owns the two lots where the Havenicks want to construct their gaming operation.

Althabe frets that Edgewater’s infamously horrendous traffic will become even more dreadful with a gigantic parimutuel.

“If they are going to have 4,000 people coming to a jai alai game, how are they going to accommodate those 4,000 people? They include 1,000 off-street parking but … where are the other 3,000 [cars] going to be parking?” Althabe asked.

Lawsuits & Unknown Numbers

Havenick pointed out that while the agreement outlines the venture’s maximum size entitlements, the actual size of the venue has yet to be determined. He also countered that studies conducted by his team revealed there will be far less traffic coming to the parimutuel than there would be for a movie theater. He insisted that the facility will provide hundreds of jobs and some much-needed amusement in a corridor where entertainment options are limited.

“The museums close at 5 or 6. All you have are bars and restaurants. There are no movie theaters. There are no forms of entertainment,” Havenick said.

During the nine years the Havenicks have been trying to bring jai alai and poker to Edgewater, the Genting Group invested around $500 million purchasing 30 acres of property in Omni, including the former Omni International Mall and the Miami Herald building, with the intent of building Resorts World Miami, a mega-project that would include a casino with 2,000 to 8,500 slot machines. Community backlash followed, and Genting’s resort casino plans fell into limbo.

To this day, its efforts to get a gaming license have yet to gain traction in Tallahassee.

Meanwhile, developer Jeffrey Soffer might still have a chance to transfer his gaming license at Big Easy Casino in Hallandale to the Fontainebleau Hilton in Miami Beach at the special session, according to local news reports.

Whereas Genting’s efforts publicly stalled, those of the Havenicks’ quietly progressed.

In two separate memos dated August 2012 and January 2018, City of Miami planners, responding to inquiries from the Havenicks, opined that a gambling venue could be built on lots located in Edgewater’s NE 2nd Avenue and Biscayne Boulevard commercial corridors because entertainment was permitted there.

In June 2018, West Flagler Associates, a limited liability company connected to Magic City Casino, snagged a gaming permit for 3195 NE 2nd Ave. from the Division of Pari-Mutuel Wagering.

Three months later, in response to public outcry about the gaming permit, the Miami City Commission passed an ordinance proposed by Russell requiring a four-fifths vote from the elected body for any new gambling venues. A Miami Herald investigation later revealed that Braman’s attorneys had drafted the legislation Russell had proposed. West Flagler Associates filed suit against the City of Miami in April 2019 to overturn the ordinance, claiming they were unfairly targeted and that the rules were being changed in the middle of the game.

When the city commission voted 3-2 to settle the lawsuit in April 2020, Mayor Francis Suarez vetoed it, only to have city attorney Victoria Mendez claim he had no ability to veto legal settlements. That led to another lawsuit filed by Suarez to challenge Mendez’s ruling, as well as a separate suit filed by Braman and other gambling opponents claiming the settlement agreement was illegal.

Community Asset or Liability?

The new settlement agreement reached last month ends that legal quagmire and paves the way for construction.

Havenick told the Biscayne Times that the gaming venue would be part of a future mixed-use project built by Crescent Heights. But Russell Galbut, a partner in Crescent Heights, would not confirm that assertion, saying he hasn’t discussed developing the venue with Magic City’s operators, the Havenicks. Galbut also said the designated lots in Edgewater, around 13,000 square feet in size, are much too small to hold a jai alai fronton that can seat 4,000 people, plus a 500-seat poker room.

“It’s not going to have that many seats. Never. They can’t fit that many,” Galbut said. “I don’t believe we will build it. We build big buildings, not small buildings.”

Whatever the size, he is sure a jai alai fronton and poker room will be an asset to the community, not a detriment.

“It will be a place to socially gather … Great for the community,” said Galbut.

But John Sowinski, president of Orlando-based No Casinos, warns that gambling venues, even without slot machines, tend to suck money from the surrounding economy.

“Gambling takes money out of the community. It doesn’t bring money into communities, Money spent on gambling is not spent elsewhere,” he said.

Althabe is worried that state legislators or city of Miami commissioners may simply allow slot machines at the Edgewater gambling venue in the future.

“The whole thing is going in the wrong direction,” Althabe said. “[Politicians] just keep adding more gambling.”

Sowinski said that Florida Amendment 3, passed in 2018 to forbid any expansion of gambling without voter approval, is being circumvented.

“The Legislature right now, they’re talking about half a dozen things that violate Amendment 3,” he said. “[Their attitude] is, we’re right until someone sues us and proves us wrong.”