The Krasnodar region announced Monday that it would hold auctions for land plots in the planned Azov-City gambling center on July 1.
The gaming center, located on the border of the Krasnodar and Rostov regions along the Azov Sea, was created late last year as one of four national zones where the country’s gambling industry would have to move after a ban comes into effect for the rest of the country on July 1, 2009.
Regional authorities said in a statement on their web site that they expected it to bring 2 billion rubles (USD 85 million) to government coffers per year.
„On July 1, the Krasnodar regional authorities will offer Russian and foreign investors 20 land plots in the gaming zone. They will be bidding for long-term leases with the right to buy after construction on them is completed,“ the statement said.
Investors will build the gambling center „just like a Cossack village – starting with one street, from the ground up,“ and the 100-hectare site will eventually grow into „an entire Azov Las Vegas,“ according to the regional government’s plans.
Among the companies that have signaled an interest in the development is Casinos Austria, Interfax reported Friday.
Representatives from the Vienna-based casino owner and operator met with Rostov Governor Vladimir Chub and „expressed their interest in the Azov-City project,“ calling it an „excellent idea,“ the Rostov government said in a statement, Interfax reported.
The Krasnodar government said in its statement that the region would spend nearly 500 million rubles (USD 21 million) to provide electricity, gas and water to the facility, the statement said.
The regions are counting heavily, however, on investors to make the necessary outlay to get the zones on their feet.
The Krasnodar government statement said it was hoping to find companies to invest USD 3 billion to USD 5 billion in Azov-City’s development.
„For now, the administration is betting on an Austrian business – in the immediate future an agreement will be signed with a company that is willing to build 100,000 square meters of hotels and casinos on 20 hectares in the Shcherbinov region.“
The statement did not identify the company.
The zones, which have been promoted as a way to draw tourists and revenues to the regions, came into question last week when Finance Ministry estimates suggested that they might cost 727.5 billion rubles (USD 31 billion), with 101 billion rubles coming from the government for infrastructure, Kommersant reported. A government source told the newspaper that the ministry might seek to amend the law creating the zones if funding could not be provided.
The three other gambling zones are in the Kaliningrad, Primorye and Altai regions.