{"id":14161,"date":"2014-07-24T10:15:47","date_gmt":"2014-07-24T18:15:47","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=14161"},"modified":"2023-02-07T06:48:33","modified_gmt":"2023-02-07T14:48:33","slug":"glimmers-of-hope-on-the-boardwalk","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/glimmers-of-hope-on-the-boardwalk\/","title":{"rendered":"Glimmers of hope on the Boardwalk"},"content":{"rendered":"

Every morning, Atlantic City<\/strong> Mayor Don Guardian<\/strong> (R) rides his bicycle along the Boardwalk. This morning, Guardian must have felt he was carrying a heavier burden than usual. Although Hizzoner has maintained that Atlantic City will come out on the other side of a series of casino closings stronger than before, that didn’t play with Moody’s Investor Service<\/strong>. Blowing off arguments that the Atlantic City market needs to downsize in order to survive, Moody’s lowered the Boardwalk’s credit rating to junk level<\/a>, Baa2 or “speculative.”<\/p>\n

Wrote Moody’s analysts Vito Galluccio<\/strong> and Julie Beglin<\/strong>,\u00a0\u201cThese [weakened fundamentals] result from ongoing casino revenue declines, expected near-term casino closures, and the impact of sizable casino tax appeals, all of which has stemmed from increased competition from casinos in neighboring states.\u201d The prospective unemployment that will result from the Showboat<\/strong>, Trump Plaza<\/strong> and Revel<\/strong> closings is truly staggering: According to Bloomberg, 6,248 Atlantic citizens will be going on the dole.\u00a0<\/span><\/p>\n

\"don-guardian\"<\/a>Guardian’s response was stoic:\u00a0\u201cTheir reasoning for the new rating is exactly what we\u2019ve said over and over again \u2013- regional competition for casino gaming is directly weakening Atlantic City\u2019s casino revenues.\u201d He’s got to make good on his promise to reinvent the Boardwalk as an all-around entertainment before gambling can come online in New York State<\/strong> or in northern New Jersey<\/strong>. (Et tu<\/em>, Meadowlands<\/strong>?) At least he doesn’t have casinos asking for direct state handouts, like the racinos in Delaware<\/strong>.<\/span><\/p>\n

\"brown_chris_color\"<\/a>Guardian has an ally in Assemblyman Chris Brown<\/strong> (R), even though other area lawmakers are waffling. Said Brown,\u00a0\u201cUntil we are given time to fully diversify our resort and increase our non-gaming attractions and revenue, there is no deal that can be cut that will protect Atlantic City [from North Jersey casinos]. That is why I will continue to fight a ballot question [aimed at] expanding casinos to North Jersey.\u201d<\/span><\/p>\n

Unlikely as it seems, Guardian says he’s \u00a0met with potential buyers and good offers are on the table<\/a>. (How good can the offers be in such a depressed market?) After saying Trump Plaza has no potential buyers, Guardian added that\u00a0Revel \u00a0has a half-dozen suitors, there’s interest in the Showboat and that the Atlantic Club<\/strong> might be re-sold, too, potentially to Latitude 360<\/strong>. Guardian thinks Revel will go for $200 million to $300 million, adding that\u00a0\u201cyou\u2019re still getting a $2.2 billion, architecturally significant building … Everyone likes a fire sale.”<\/span><\/p>\n

(“Trump Plaza, by all accounts, needs a significant amount of renovation work,” said state Sen. James Whelan<\/strong> [D]. “We have talked to people about the sales. My sense is that they would like more time.”)<\/span><\/p>\n

TJM Properties<\/strong>, owner of the Atlantic Club, has no imminent plans for that ex-casino, so it might be amenable to a flip. Also, an ex-casino may be sought by the\u00a0Richard Stockton College of New Jersey<\/strong> in its quest to have an Atlantic City campus.<\/span><\/p>\n

\"low_revel\"<\/a>In the meantime, area legislators are keeping the pressure on<\/a> the Casino Control Commission<\/strong> to compel the three casinos to stay open another four months, arguing that the state has a “moral obligation” to the workforce. (It’s nice to see that moral obligations haven’t gone out of politics.) “[T]he current circumstances are unprecedented and present novel issues which we have been and will continue to review,” replied the NJCCC’s Matthew Levinson<\/strong>.<\/span><\/p>\n

Replied gaming analyst Alan Woinski<\/strong>,\u00a0“They can’t say ‘no you can’t.\u00a0If anyone buys these properties, they’re going to be in the exact same position as the previous owners.” He allowed that the Showboat was “decent” and might draw a bidder but that Revel needed new management in order to survive.<\/span><\/p>\n

There’s good news<\/strong> from the Gulf Coast of Mississippi<\/strong>, where casino revenues leapt 13% in June, the best such gain since 2008<\/a>. This buttresses the contention that the closure of Margaritaville Casino<\/strong> is an aberration in the market. That $96 million June more than compensated, statewide, for the subtraction of Harrah’s Tunica<\/strong>, which helped depress riverboat\u00a0revenues by 12%.<\/p>\n

“But the downturn from 2013 was about as steep in April and May, reflecting that business from Harrah’s was already evaporating. Still, [Tunica Convention & Visitors Bureau<\/strong> CEO Webster Franklin<\/strong>] \"HarrahsTunicaExterior\"<\/a>said it appeared that the remaining eight casinos in Tunica County<\/strong> had not captured the business that Harrah’s lost, in part because that facility had the market’s largest convention space and in part because Caesars<\/strong> [Entertainment<\/strong>] reduced the number of chartered gambling flights.” Overall, Mississippi state gaming revenues remain 25% off their 2007 heights, which may turn out to have been another aberration.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Every morning, Atlantic City Mayor Don Guardian (R) rides his bicycle along the Boardwalk. This morning, Guardian must have felt he was carrying a heavier burden than usual. Although Hizzoner has maintained that Atlantic City will come out on the … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[23,14,7,35,33,25,157,169,38],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/14161"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=14161"}],"version-history":[{"count":2,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/14161\/revisions"}],"predecessor-version":[{"id":32316,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/14161\/revisions\/32316"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=14161"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=14161"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=14161"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}