Revel Atlantic City To Be Sold?November 11, 2013 11:23 am
Last year, the $2.4 billion Revel Atlantic City opened to much fanfare in New Jersey as it was hoped the luxury resort would help reverse the state’s declining gambling industry. Unfortunately, the project was extremely poorly timed and not long after Revel entered bankruptcy protection before striking a deal with its creditors earlier this year.
At the time, officials expressed their hope that the property would start operating profitably by the Summer of 2014, but so far in 2013 Revel has managed to lose $81 million and the casino’s owners are now said to be “exploring strategic options” as they seek to reverse the fortunes of the casino. The options currently being mulled include selling the property or restructuring its loans.
Unfortunately for Revel, the problems facing the ambitious project are systematic of those afflicting the east coast gambling resort as a whole, as Atlantic City has seen its casino revenues shrink by 40% over the past six years as increased competition from neighboring states eats away at its gambling businesses.
For the first nine months of this year alone, the once busy seaside resort gambling revenues have declined by 9.3% to $2.2 billion, with potential annual earnings expected to be dramatically lower than the $5.2 billion in revenue generated by its casinos in 2006.
Consequently, Revel is not the only one of Atlantic City’s 12 casinos currently experiencing major challenges and last week another struggling Atlantic City venue, the Atlantic Club Casino Hotel, also had to declare bankruptcy ahead of a sale at auction.
The one bright spot on the horizon for the city, however, is the introduction of online poker beginning November 26. Nevertheless, with anticipated annual earnings expected to be just $1 billion, and with the news last week that New York was planning on building 7 casinos to keep gamblers within its state, the future looks less than bright for the once bustling seaside resort.