Foxwoods at 30: How a Connecticut Tribe Built the Largest Casino on Earth With a $60M Loan From a Malaysian Billionaire
In 1986 the Mashantucket Pequot tribe had 55 acres, 187 enrolled members, and a bingo hall. By 2008 they ran the largest casino on Earth. The whole thing was financed by a Malaysian gambling tycoon who never set foot in Connecticut.
The Mashantucket Pequot tribe was federally recognized in 1983 with about 55 acres of land. They opened a bingo hall in 1986, then leveraged the 1988 Indian Gaming Regulatory Act to add table games in 1992 and slots in 1993 — the slots required a separate deal with the State of Connecticut for 25% of slot revenue forever. The expansion was funded in part by a $60M loan arranged through Malaysian gaming mogul Lim Goh Tong (Genting Group). At its 2007 peak, Foxwoods was the largest casino in the world by floor space.
The Pequot War of 1637 nearly exterminated the tribe. By 1972 there were two enrolled members living on a 200-acre reservation in Ledyard, Connecticut. The land was so neglected that it was being foreclosed for unpaid taxes.
That tribe would, fifty years later, run a casino that grossed more revenue than any single MGM or Caesars property in Vegas.
The 1983 federal recognition
Skip Hayward, the tribal chairman, spent a decade lobbying Congress for federal recognition. The Mashantucket Pequot Indian Land Claims Settlement Act passed in 1983 — federally recognizing the tribe and granting back about 800 acres of contested land.
Federal recognition meant the tribe was a sovereign nation that could not be taxed by Connecticut and could enact its own laws on tribal land. In 1986 they opened a bingo hall.
The 1988 Indian Gaming Regulatory Act
The IGRA, passed in 1988, gave federally recognized tribes the right to operate casino-style gaming if the state already permitted such gaming for any purpose. Connecticut allowed "Las Vegas Nights" — charity casino events — which legally counted.
The tribe sued the state to compel a gaming compact. They won in 1991. Foxwoods opened as a full table-games casino on February 15, 1992.
The Lim Goh Tong loan
Banks would not lend to a sovereign tribe. The Mashantucket Pequot needed roughly $60M to build out the property. They eventually got the financing from Lim Goh Tong, the Malaysian gaming tycoon who built Genting Group (operator of Resorts World Genting Highlands and later Resorts World Las Vegas).
The deal: Lim's company loaned $60M and got operating fees plus a percentage of revenue for the first decade. Lim Goh Tong, who never visited Connecticut, took an equity-like position in what became the largest casino on Earth.
The tribe paid back the loan in three years. Connecticut's slot-revenue payment alone — 25% of slot win — has totaled over $8B paid to the state since 1993.
The 2008 peak — and the 2012 near-collapse
By 2007 Foxwoods covered 4.7 million square feet, had 7,200 slot machines, and was — measured by gaming floor — the largest casino in the world.
Then 2008 hit. Tribal gaming revenue across the US fell 7%. Foxwoods had $2.3B in debt — much of it from a 2008 expansion (the MGM Grand at Foxwoods tower) that opened months before the recession.
In 2012 the tribe negotiated a debt restructure. By 2014 the property had stabilized but never fully recovered to its 2007 peak. The MGM Grand branding partnership ended in 2013 and that tower was rebranded as "The Fox Tower."
Foxwoods vs Mohegan Sun
Mohegan Sun opened in 1996 — four years after Foxwoods — eight miles down the road. The two casinos have competed for the same Connecticut/Boston/NYC players for 30 years. Today's split:
What the Foxwoods story means
The Foxwoods story is the tribal-gaming story in miniature. The IGRA created roughly 500 tribal casinos in 30 years, generating $40B+ in annual revenue — more than commercial casinos. A handful of those operations (Foxwoods, Pechanga, Seminole Hard Rock, Choctaw) became larger than most Strip properties.
The lesson for visitors: tribal casinos are not "lesser" than commercial casinos. The top tribal properties have the same machine selection, the same RTP regulations (or stricter — California tribes pay back 92%+ on slots, higher than most regional commercial markets), and often better comps because they're not extracting cash for shareholders.
The full casino directory is filterable by tribal vs commercial. We're tracking 47 tribal properties across 14 states.
Topics
- foxwoods
- history
- tribal
- connecticut