Trump Plaza Closes: Atlantic City Down to 8 Casinos

Early Tuesday morning the Trump Plaza Casino in Atlantic City officially closed its doors after a 30-year-run on the Boardwalk. Trump Plaza is the fourth Atlantic City casino to shutter its doors in 2014, and may not be the last.

Once considered one of the shining stars in Atlantic City, Trump Plaza has been declining for decades, and has been unable to keep up with the newer casinos that sprang into being since they opened up shop in 1984. The fall has been extremely pronounced in recent years where the casino has operated in the red.

The Trump Plaza’s fate may have been sealed back in February of 2013 when a $20 million sale of the casino to the Muerelo group fell through. Once the deal soured Trump Plaza was virtually ignored and as some visitors and employees have stated, the slow decline turned into a freefall.

Financial Struggles Were Simply Too Much

A quick look at the casino’s recent financial and operating numbers would be enough for anyone to see the end was near.

The Trump Plaza generated the least amount of revenue of any property in 2014, with just $37 million in Gross Gaming Revenue YTD. To put this in perspective, two other casinos were roughly three-times that amount and also had to close up shop, as Showboat generated $111 million and the Revel $98 million.

The trump Plaza wasn’t just last, they were last by a country mile.

Comparing Trump Plaza to the profitable casinos paints an even more dismal picture. Trump Plaza’s YTD GGR was about 1/12th that of Borgata’s, and about 1/7th the revenue of Caesars ($221 million) or Harrah’s ($241 million).

Revenue doesn’t tell the whole story, considering Revel was hemorrhaging more money than any other casino in AC, but on top of dismal revenue numbers the Trump Plaza was consistently operating in the red, including a $3.3 million loss in Q2 of 2014 and a $7.4 million loss for H1 of 2014.

Trump Plaza operated at a $1.3 million loss during H1 of 2013, which validates the points made by visitors and employees that the casino has been freefalling since the Muerelo Group deal fell through.

Trump Plaza also produced some of the most abysmal occupancy numbers imaginable. During Q2 of 2014 Trump Plaza’s occupancy rate was 57.3%, while only two other hotels were below 80%, the Trump Taj Mahal at 73% and Tropicana at 78%. For H1 of 2014 the occupancy rate was even lower at 51%*.

*(Room rates at Trump Plaza were slightly below average for AC casinos, yet higher than Trump Taj Mahal)

Considering these numbers it wasn’t a matter of if, but when the Trump Plaza would close.

Speaking Of The Trump Taj Mahal…

The parent company of Trump Plaza and Trump Taj Mahal is currently in the middle of a Chapter 11 bankruptcy restructuring that has the future of the Trump Taj Mahal (a slightly profitable casino at the moment) in question.

Trump Entertainment has said it will close the property down in November unless the local unions make certain concessions that will lighten the company’s burden in Atlantic City.

The danger here isn’t that another casino could be shuttered. What is at stake is the very livelihood of thousands of jobs in the city, and more worrisome is the abruptness of the loss of jobs in the area.

The Atlantic Club put 1,600 employees out of work when it closed in January. Showboat sent another 2,000 workers to the unemployment lines when it closed in early September (Caesars stated that 400 of those jobs were moved to other properties). When Revel closed just days later it cost the community another 3,000 jobs. Trump Plaza’s impact is another 1,200 jobs.

All told Atlantic City is down somewhere around 7,500 jobs already (some 6,000 in a matter of weeks), and with each subsequent closure there are less and less opportunities for those jobs to be replaced at another property.

This immediate and substantial loss of jobs could be devastating for the local economy, and could make a revitalization effort even more difficult.

About the Author

Steve Ruddock

Steve is a seasoned veteran of the online gambling industry, having written about it from every possible angle in his many years as a freelance gaming writer. Based in Massachusetts, Steve especially focuses on regulatory and legislative news coverage pertaining to the U.S. market.