A Look At Atlantic City Casinos
The Atlantic City Press has a great article looking back at the past year and forward to this year for each Atlantic City casino. Click here to see all of the analyst comments. Below are the bullets for each casino. I covered most of this as it was announced (go me!), but here’s a consolidated list.
Trump Plaza Hotel and Casino
Opened: May 14, 1984
Owner: Trump Entertainment Resorts Inc.
Employees: 2,187
2009 revenue: $202.3 million
Trump Plaza’s dismal performance in 2009 included a 28.7 percent decline in table game revenue and a 20.2 percent drop in slot winnings. The property will likely fall below $200 million in revenue in 2010. In 2005, it had more than $303 million in revenue.
This Boardwalk casino could use a facelift. Not much has happened since the casino floor was remodeled in 2006. Its architecture is hopelessly outdated. The Boardwalk entryway is like a portal to the 1980s.
Whoever wins in the bankruptcy fight over the Trump casinos will have to decide whether to unload the Plaza or upgrade it to take advantage of its prime Boardwalk location.
In what seems far-fetched now, in the pre-recession days of 2006, casino titans Donald Trump and Steve Wynn briefly played with the idea of redeveloping the Plaza into a
$3 billion megaresort.
Trump Taj Mahal Casino Resort
Opened: April 2, 1990
Owner: Trump Entertainment Resorts Inc.
Employees: 4,097
2009 revenue: $446 million
Donald Trump once boasted that this Indian-themed gaming palace was the “eighth wonder of the world.” Although it falls short of that lofty assessment, it did prove to be one of the few casino standouts in a dreadful year. The Taj joined Borgata as the only casinos that avoided double-digit revenue declines. For the Taj, it was 7.6 percent.
Moreover, the Taj was the only casino to have only a single-digit decline in both slot and table game revenue. Taj’s ace is its new 800-room hotel tower. Opened in Labor Day 2008, the $255 million expansion has generated extra hotel and convention business without using slot machines or table games as the main attraction. The tower is completely gaming-free.
Taj’s new owner will get the new tower, a remodeled casino, surrounding property good for expansion and the world-famous Steel Pier amusement park. Trump Entertainment flirted with redevelopment plans for the historic pier, but always lacked the money. With the right vision, and enough financing, a revamped pier jutting 1,000 feet over the ocean could become, well, the “eighth wonder of the world.”
Trump Marina Hotel Casino
Opened: June 17, 1985
Owner: Trump Entertainment Resorts Inc.
Employees: 1,799
2009 revenue: $162.6 million
Trump Marina is the cellar-dweller for gaming revenue. Overshadowed by Marina District neighbors Harrah’s Resort and Borgata, the smallest of the three Trump casinos pulled in only $10 million in revenue in December. That was 25 percent lower than December of 2008.
For 2009, Trump Marina’s slot winnings plummeted 19.2 percent, to $125.3 million, and table game revenue fell 23 percent, to $37.3 million. Its total revenue of $162.6 million was even less than the $176.6 million that the tiny Sands Casino Hotel had in its last full year of operation in 2005.
The Sands closed down in November 2006 and was imploded a year later to make room for a proposed new casino. Analysts wonder whether Trump Marina awaits the same fate. Efforts to sell the Marina for $270 million failed last year, and now the casino is part of the Chapter 11 bankruptcy battle for the entire Trump Entertainment gaming empire.
Icahn is vying with a bondholder group backed by Donald Trump for control of the Trump casinos. A U.S. Bankruptcy Court judge is scheduled to rule in February whether Icahn or the bondholders will take over.
Atlantic City Hilton Casino Resort
Opened: Dec. 9, 1980
Owner: Colony Capital LLC
Employees: 2,063
2009 revenue: $192 million
Analysts question how much longer the Hilton can hold on. Atlantic City’s smallest casino defaulted on its $348.2 million mortgage in July and is in talks with its lender to restructure the debt.
Nicholas L. Ribis, Hilton’s chief executive officer, insisted in a recent interview that the gaming hall will not close or even fall into Chapter 11 bankruptcy, the traditional route for casinos to overhaul their finances.
The Hilton’s revenue plunged 22.9 percent in 2009, tying it with Trump Plaza as the worst performer. Slot revenue was down 20.6 percent to $138 million, while table game winnings plummeted 28.3 percent to just less than $54 million.
In Atlantic City’s heyday of 2006, the Hilton hauled in more than $330 million in annual revenue. Comparing 2009 with 2006, the Hilton’s revenue has plummeted a startling 41.8 percent. No other casino is down that much during that timespan.
Caesars Atlantic City
Opened: June 26, 1979
Owner: Harrah’s Entertainment Inc.
Employees: 3,375
2009 revenue: $460.2 million
Caesars is known for its high rollers and table games play. However, table game revenue slumped nearly 19 percent to $175.5 million in 2009. Slot revenue came in at $284.8 million, off 13 percent.
Caesars jumped into the city’s booming party scene last year by opening the Dusk nightclub, an upscale entertainment spot once co-owned by celebrity disc jockey Adam “DJ AM” Goldstein, who died of a drug overdose only a month after the club’s summer debut.
The recession hurt another nongaming attraction associated with Caesars: The Pier at Caesars, a high-end Boardwalk shopping mall linked to the casino, is being taken over by lenders after its owner, Taubman Centers Inc., said the retail operations weren’t generating enough cash to pay the $135 million mortgage. For now, The Pier is operating as normal.
Harrah’s Resort
Opened: July 20, 1981
Owner: Harrah’s Entertainment Inc.
Employees: 3,910
2009 revenue: $488.5 million
Harrah’s Resort surpassed sister property Bally’s last year to become the city’s No. 2 grossing casino, even though its revenue was down 10.3 percent overall.
Harrah’s was the only casino in town that showed growth in table games revenue, a modest 1.9 percent. Slot revenue sank
13 percent to $388.3 million, but Harrah’s remains second only to Borgata in slot winnings.
Now the flagship of the Harrah’s Entertainment empire, Harrah’s Resort has been transformed in the past two years into a flashier, more luxurious rival to next-door neighbor Borgata. A $550 million expansion completed in 2008 added a 960-room hotel tower and a striking pool and spa complex underneath a 90-foot-high glass dome.
The Pool, as the complex is known, has become a magnet for younger customers. Harrah’s enhanced the party vibe by adding a $1 million nightclub, called The Loft, over New Year’s weekend.
Tropicana Casino and Resort
Opened: Nov. 23, 1981
Owner: Investors led by billionaire Carl C. Icahn will become new owners
Employees: 3,241
2009 revenue: $313.6 million
Was 2009 a good or a bad year for Tropicana? The casino went into Chapter 11 bankruptcy in April. However, an Icahn-led investment group plucked Tropicana out of bankruptcy for
$200 million and will soon take charge.
The ownership switch will finally end the casino’s regulatory limbo. Tropicana has been on the market and under the control of a state-appointed conservator ever since the New Jersey Casino Control Commission stripped the troubled former owners of their gaming license in December 2007.
As usual, Tropicana ended in the middle of the pack for casino revenue. Its slot machines generated $221.8 million in winnings, down
12 percent. At the table games, Tropicana’s take was $91.8 million, a decline of 12.4 percent.
Analysts question whether Icahn — whose personal net worth is estimated at $14 billion — will settle for having mediocre revenue or will invest millions to transform Tropicana into a top casino.
into a top casino.
Resorts Atlantic City
Opened: May 26, 1978
Owner: RAC Atlantic City Holdings LLC
Employees: 2,164
2009 revenue: $191.7 million
In 1978, Resorts was the first casino to open in Atlantic City. In 2009, it became the first Atlantic City casino ever taken over by its lenders. Resorts agreed to let the banks take charge after it defaulted on its $360 million mortgage and faced possible foreclosure.
The banks replaced owner Colony Capital LLC, a private real estate investment firm that bought Resorts in 2001 for the fire-sale price of $140 million. Colony remains the owner of the Hilton. Nicholas L. Ribis, Colony’s partner in both the Hilton and Resorts, is running Resorts for the banks. However, the banks have made it clear they intend to sell Resorts as quickly as possible, with Ribis seen as a possible buyer.
Resorts is the second lowest-grossing casino. Total revenue fell nearly 18 percent in 2009. Its slot winnings were down 18.3 percent to $142.4 million, while table game revenue sank 16.4 percent to $49.3 million.
Through the first nine months of 2009, Resorts suffered a $7.1 million loss in operating profits and a $23.9 million loss in net income. Operating profits for the fourth quarter of 2009 won’t be reported until April.
Resorts’ future was a lot shakier before lenders took over. Previously fighting for its survival, the casino is now in the enviable position of having no debt because the lenders wiped away the mortgagewiped away the mortgage.
Showboat Casino Hotel
Opened: March 30, 1987
Owner: Harrah’s Entertainment Inc.
Employees: 2,539
2009 revenue: $316.7 million
Showboat continues to try to transition from the elderly, low-rolling bus crowd that has defined it for years to a younger, more affluent customer base. Parent company Harrah’s Entertainment hopes to take better advantage of the House of Blues nightclub and a 2,380-seat music hall to attract younger patrons.
Slot machines are Showboat’s bread and butter. It ranks sixth in the industry in slot revenue, but only eighth in table game winnings. Showboat raked in $259.3 million at the slot machines last year, a decline of
11.5 percent. Revenue from table games plunged 17.3 percent to $57.4 million. Showboat’s total revenue fell 12.6 percent, a respectable showing when compared with the industry average of 13.2 percent.
Analysts often speculate that Showboat will be the first casino sold if Harrah’s Entertainment decides to trim its Atlantic City holdings. But Don Marrandino, Eastern Division president for Harrah’s, said there are no plans to sell Showboat.
Come 2011, Showboat will have a brand-new neighbor. The mammoth $2 billion Revel casino already dwarfs Showboat as construction continues on its soaring 1,900-room hotel tower and beach-themed casino.
Borgata Hotel Casino & Spa
Opened: July 2, 2003
Owners: Boyd Gaming Corp. and MGM
Mirage Inc.
Employees: 6,603
2009 revenue: $695.3 million
Atlantic City’s newest and most luxurious casino suffered only a single-digit revenue decline in 2009, allowing it easily to retain its status as the top-grossing property. Revenue was down just 5.9 percent overall. Slot revenue dipped 2.3 percent to $431.4 million, while table game winnings declined
11.2 percent to nearly $264 million.
Borgata has stayed at the head of the pack with the help of an ambitious entertainment schedule. Its posh surroundings and cutting-edge nightlife attract a younger, wealthier crowd. Pop superstar Mariah Carey highlighted Borgata’s New Year’s holiday weekend celebration with a Jan. 2 concert.
Borgata, though, hasn’t completely avoided the troubles engulfing the Atlantic City market. Slow midweek business in the winter has forced it to mothball its chic 400-room Water Club hotel on Tuesdays, Wednesdays and Thursdays for the second year in a row. The hotel reopens for the busier weekends.
Last year, the Water Club fully reopened in May to coincide with the start of the peak summer tourist season. The same thing is expected this year.
Bally’s Atlantic City
Opened: Dec. 29, 1979
Owner: Harrah’s Entertainment Inc.
Employees: 4,399
2009 revenue: $474.3 million
Once the second-highest grossing casino, Bally’s slipped to third in 2009 and is feeling heat from Caesars Atlantic City and Trump Taj Mahal Casino Resort for the No. 3 spot. Bally’s is popular with the slots crowd, but saw revenue in that category fall 20.3 percent to $314.3 million. Table-game winnings held up reasonably well, dipping only 7.7 percent to $160 million.
Parent company Harrah’s Entertainment is planning to give the 30-year-old casino a facelift this year. The 500-room Claridge Tower will be revamped into a more upscale hotel similar to the W Hotel chain. Plans also call for renovations to the Bally’s convention facilities. Harrah’s said a downturn in convention business hurt the casino last year.
Harrah’s Entertainment once thought of rebranding Bally’s but held off. A name change may still be in its future. Currently, the sprawling complex is a patchwork of disparate buildings and themes. It incorporates the Depression-era Claridge, the Victorian-era Dennis Hotel, the cowboy-like Wild Wild West Casino and the modern glass-covered Bally’s tower.
Prior to the recession, customers didn’t seem to mind Bally’s aging appearance. At its peak in 2006, the casino won $677.3 million from gamblers, 30 percent higher than 2009’s revenue.
