San José, Costa Rica, since 1956

18-Story Downtown Casino Project Draws Fire

If a group of U.S. investors has its way, Costa Rica’s historic National Theater and Culture Plaza will become neighbors to a gargantuan, 18-story, $200 million “Las Vegas style” luxury resort.

The plans to build what developers say will be Latin America’s biggest casino hotel in the heart of downtown San José’s historic center is drawing fire from some who say such a project is a threat to Costa Rica’s historical heritage in an already jam-packed downtown.

The Rainforest Resort & Casino would overshadow the National Theater and Gran Hotel Costa Rica, among other buildings that have been dubbed historical buildings or historical sites. Gran Hotel Costa Rica Manager Eric Gutiérrez recently filed a formal complaint with the Ministry of Culture, Youth and Sports calling the casino hotel project “an aggression against Costa Rica’s historical and architectural patrimony.”

“This will change Costa Rica’s cultural dynamic,” he told the Tico Times.

By law, the Culture Ministry must approve any changes to historical sites. In his complaint, Gutiérrez also alleges the Municipality of San José has “pre-approved” the hotel project.

David Sebag, the Los Angeles, Californiabased investor heading the project, said Gutiérrez “doesn’t know what he’s talking about.” Sebag said the investors have been going through all the required legal processes, and alleged Gutiérrez is angry because Sebag’s group also wants to buy out Gran Hotel Costa Rica.

“We’re planning to buy his hotel, and we didn’t come to an agreement.Now, he’s trying to play some kind of dirty game,” Sebag told The Tico Times at the offices of Grupo San José, the local company representing Rainforest Resort & Casino S.A. His investment group has made a $15 million offer with the owner of the 76-year-old Gran Hotel.

Sebag’s said he is involved in different businesses, including restaurants, casinos, bars and nightclubs throughout the United States.

“I used to have a couple strip clubs too, of course,” he said.

Gutiérrez told The Tico Times he is concerned about the type of development being proposed.

“If this was a Four Seasons it wouldn’t be a problem,” he explained.

History is History

Urban development in San José has long been encroaching upon the city’s historical patrimony, according to University of Costa Rica history professor Ivan Molina.

Gran Hotel Costa Rica is located next to

the 28-year-old Las Arcadas commercial center,

on property the investment group is

planning to buy.

The planned casino hotel site overlooks Juan Mora Fernández Park, which blends into the Culture Plaza, is near the 119-year-old Edificio de las Academias (currently under restoration), and faces the 109-year-old National Theater, often referred to as the crown jewel of Costa Rican architecture. Gutiérrez said the theater is “obviously the most important building in Costa Rica.”

The park also once bordered Santo Tomás, Costa Rica’s first university, since replaced by the Finance Ministry building.

Juan MoraFernándezPark is named after Costa Rica’s first head of state, who came to power on the heels of a war between San José and the colonial capital Cartago.

San José won the war, and was made the state’s capital in 1823. At the time, Costa Rica was a state in the Central American Federation, according to Molina.

Because of its late 18th century origin as the nation’s capital, San José has little of the Spanish colonial architecture common in most Latin American capitals. And much of the capital’s 19th century architecture has been destroyed by earthquakes and “urban progress,” he said.

One such example, he continued, was the original National Library building, an “architectural jewel” demolished in the 1950s to make room for a parking lot. The parking lot is now used by clients who go to the popular Hotel Del Rey seeking prostitutes, among others, he said.

Molina said a large casino hotel project in the downtown historical center could threaten the nation’s architectural and historical heritage, but that’s not his main concern.

“A hotel of that maginitude in San José, with its traffic problems and the streets that it has, would make the traffic problems worse,” he said, adding that such a construction would exemplify San José’s “lack of urban policy.”

Roberto Dent, owner of Centro Comercial Las Arcadas, said the group of U.S. investors has put down $200,000 to buy the commercial center, and has about three months to pay the remaining “several million dollars owed.”

Asked whether the new hotel could be detrimental to San José’s historical patrimony, Dent said, “If we sell it, we would have nothing to do with it anymore.”

He said the deal came to fruition after he was contacted by Juan Carlos Obando, who runs the Grupo San José, and helped Sebag and his investors negotiate the buying of the commercial center. Obando was head of the waste-management company Berthier EBI de Costa Rica last year when a scandal erupted over alleged illegal kickbacks to San José Mayor Johnny Araya, re-elected this week (see separate story), and other municipal officials in exchange for a multimillion-dollar contract to construct a landfill (TT, July 22, 2005). The Judicial Investigation Police (OIJ) is investigating the allegations, which Obando claims are a set-up. Additionally, Aserrí Mayor Mario Morales, also re-elected Sunday, is being accused of having received an illegal loan from Obando, who at the time was still running EBI and trying to get permits to set up a wastemanagement plant in Aserrí. Obando said it was no more than a personal loan to a longtime friend.

Gutiérrez said he heard from a source familiar with the casino deal that the municipality had given the project the nod, though he declined to be more specific.

Marco Solórzano, who heads the department that gives out construction permits at the San José Municipality, said Gutiérrez’s claim that there is “pre-approval” of the project is not true. He said he has yet to receive complete designs for the project.

Solórzano received Gutiérrez’s complaint, which was forwarded to him by the Culture Ministry. Sandra Quirós, Historical Heritage Director at the Culture Ministry, did not return repeated Tico Times phone calls for comment.

Sebag, who admitted he did not know who Juan Fernández Mora was when asked by The Tico Times this week, said the new hotel will not threaten the country’s historical heart.

“We’re going to keep the same face, the same historical concept, and make it just better,” he said.

He said “the heart of the city will be revitalized” with his project. Costa Rican architect Luis Dobles is designing the project to take into consideration downtown’s historical character, and the building’s design will be similar

to the Gran Hotel Costa Rica, he added.

“If we have problems after the first phase, we’ll stop there,” Sebag said. The one-year, $20 million phase one would involve expanding the current four-floor commercial center to six floors, and making it into a 5-star casino and hotel with 58 deluxe suites, and several restaurants – one on the roof with a view of the National Theater.

The U.S. investor said the consulting company True Innovations is working on a feasibility study to see whether the traffic stuffed downtown San José can accommodate the group’s vision.

He said he has approached the owners of Librería Lehman, located on the block behind Gran Hotel, to buy that building and convert it to an eight-floor parking structure for hotel clients.

Sebag’s long-term vision is to build the biggest “5-star world-class hotel and resort casino” of its kind in all of Latin America, with a massive convention center to accommodate 3,000, nearly 400 deluxe and residential suites, six restaurants, four bars, a 15,000 square-foot gaming floor with 750 slot and video poker machines, nightclub, a sports arena with national and international boxing and wrestling events, and more.

He said the project would also include a foundation in which casino profits will be put toward grants or loans for schools, road repairs and other public projects. He said the project would create some 4,000 jobs and bring an additional 200,000 tourists here each year.

“Like everywhere in the world, you always need somebody from the outside to see opportunity and vision,” he said.

Obando said the project “will force the city to have stronger regulations, on prostitution and other areas.” Sebag promised increased security to make downtown safer if the project is approved, though he said he doesn’t yet know what the resort’s policy would be on prostitution.



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