Stations Casinos' Michigan project moves forward

GRAND RAPIDS, Michigan -- Construction of an American Indian casino near Grand Rapids, Mich., is back on track.

The Gun Lake Band of Pottawatomi Indians said it has obtained a $165 million loan arranged by Goldman Sachs, which will have a five-year term at 12 percent interest.

Work on the 83,000-square-foot project slowed after financing dried up.

Gun Lake will have 1,400 slot machines and 28 table games and is now expected to open in early 2011.

The loan is expected to be used to pay off existing debt, fund on-going construction, pay fees and create a reserve.

Station Casinos, the tribe's casino management company, had advanced more than $53 million for the development of the casino as of the end of 2009, according to documents filed with the Securities and Exchange Commission.

Gun Lake is one of several Indian gaming management and development contracts controlled by Station Casinos. The contracts will be included within the group of assets that are scheduled to be auctioned next month at the U.S. Bankruptcy Court in Reno as part of the bankrupt company's planned reorganization.

The Gun Lake Casino delay was the latest in a string of setbacks for the tribe, which spent more than 10 years dealing with regulatory and court challenges to project. When it was finally cleared for development, the national and Michigan economies tanked. Plans for the casino being scaled back.