A recent article from The Washington Post is rife with positive opinions about what will happen with New Jersey’s gambling mecca. But at least one expert, Dr. David G. Schwartz, director of the University of Nevada Las Vegas’ Center for Gaming Research, says the opening of new casinos this year could go either way.
Resorts boss bullish about Atlantic City casinos in the new year
Mark Giannantonio, president of Resorts AC, was an outspoken source in the article.
You’ll remember that it was Giannantonio who was also outspoken about defeating the November 2016 referendum that proposed the opening of two casinos in North Jersey.
While the Resorts boss may have been averse to two new casinos outside the city — he cited cannibalizing — he’s more than happy to see competing casinos open within the city.
“I’m extremely optimistic about Atlantic City and the industry in 2018,” he was quoted as saying in the article. “We’re very excited about the renaissance of Atlantic City; we think it’s for real.”
And there certainly is evidence of a renaissance. Several aging casinos in NJ have closed. And as is the case with the Trump Taj Mahal and Hard Rock, international gaming titans have poured money into the city, creating thousands of temporary and permanent jobs.
The momentum in NJ casino and gambling news isn’t just property related either. Toxic owners like Carl Icahn and Glenn Straub are, in one way or another, leaving Atlantic City.
Icahn’s Taj closed its doors in October 2016 and is now the catalyst for Hard Rock’s new property. Straub’s much-maligned TEN AC (formerly Revel) has most likely been sold to a Denver-based developer. Many details are still hazy, but we know Revel will become the new Ocean Resort Casino in 2018.
Yet, while all of these signs point to continued growth of the AC casino industry, not everyone is as rosy as Giannantonio and others.
NJ casino revenues could take a hit with new openings
UNLV’s gaming expert Schwartz says that AC’s future isn’t so much about new casinos and a renaissance as it is about pizza.
In an email interview with NJGS, Schwartz said one of two things will happen after the city’s new casinos will open: the revenue pizza will remain the same size and some casinos won’t get as much to eat… or the pizza will get bigger.
“The total gaming revenue for Atlantic City is smaller now than it was when the town supported more casinos,” said Schwartz. “More competition could be a case of dividing the same size pizza among more people, in which case, someone might not get enough to eat.”
But, if new casinos can add a certain level of novelty or innovation that draw more gamblers to AC, that pizza could go from a large to an extra large.
That certainly could be the case with the opening of the Hard Rock. The new hotel and casino will provide plenty of novelty for visitors.
Schwartz said the city’s growth and success is still up in the air. AC’s history proves that growth is good but can be tempered by the influence of casinos in neighboring states.
“It all depends on how the new properties market themselves and operate and how the existing operators react,” said Schwartz. “Historically, Las Vegas has benefited from more competition and new investment. Atlantic City did until increasing competition from other jurisdictions eroded the city’s casino customer base.”