It has been some time since optimism swirled around Atlantic City. For several years, there has only been despondency.
Since 13 casinos were operating along the New Jersey shoreline in 2013, five have since closed. New properties like the former TEN AC shut its doors even before opening. Tourism dropped.
And in February, Atlantic City’s gaming revenue dropped by 6.5 percent month-over-month, largely due to bad weather.
Despite a dark and dreary road, however, there is light at the end of the tunnel. And it begins this summer.
Boon for the Boardwalk
Highly publicized and anticipated, Hard Rock Hotel & Casino Atlantic City and Ocean Resort Casino are the big names being talked about in AC. Both plan to open this summer, and a third — Showboat Atlantic City— is reportedly interested in joining the party.
Hard Rock AC and Ocean Resort have already begun the process of hiring staff, and their applications for casino operating licenses are reportedly being fast-tracked by the state. The two casinos sit on two of the largest properties along the Boardwalk, flanking the Showboat on either side.
Currently, the Showboat is a non-gaming hotel. Its casino floor, measured at more than 125,000 square feet, has been roped off since 2014, though owner Bart Blatstein has begun his own process to reopen.
The tandem of Hard Rock AC and Ocean Resort are already expected to spark a spike in tourism along the New Jersey shoreline. Hard Rock, for example, will boast a 7,000-seat entertainment arena with a beach bar near Steel Pier.
Together, and grouped with Showboat as well as a steadily increasing market in online gambling, Hard Rock and Ocean Resort could “break the chain of poverty,” as AC mayor Frank Gilliam put it.
Fear of oversaturation in Atlantic City? Maybe, maybe not
Future revenues could increase with the opening of at least two popular casinos. But there is concern that individual earnings could decrease as the pie is sliced into more pieces.
Then again, some argue that with some innovative and headlining attractions along the Boardwalk, tourism would also increase. As a result, there would be few – if any – losses to claim.
Dr. David G. Schwartz, director of the Center for Gaming Research at UNLV, said one of two things could happen in Atlantic City with these casino openings.
“The total gaming revenue for Atlantic City is smaller now than it was when the town supported more casinos,” he said. “More competition could be a case of dividing the same pizza among more people, in which case, someone might not get enough to eat.”
Schwartz noted, however, that more attractions — especially innovative and novel casinos — could draw more gamblers to Atlantic City. As a result, those pieces would be sliced from an extra-large rather than a large pizza.
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Nevertheless, optimism abounds in AC
January and February were not the best months for Atlantic City revenue. A blizzard blasted the shore in January, a leading factor in $184.3 million in gross gaming revenue for the month — a 10 percent decrease from the previous year.
This, coupled with February’s further revenue decline for land-based casinos, might lead some to think the worst is yet to come. AC casinos clocked in at $170.1 million for a 9 percent drop from 2017.
That said, gambling sites in New Jersey enjoyed a record $21.96 million in January revenue. It was the 11th straight month that number eclipsed $20 million. And last month, the record was set again: just shy of $22 million in just 28 days.
Online traffic continues to increase. There is a chance New Jersey would be able to offer sports betting by the summer if the US Supreme Court case goes in NJ’s favor. Two new casinos are scheduled to open around the same time (perhaps three with Showboat).
So yes, the recent track record of AC casinos is littered with potholes. But growing online revenues and innovative casinos lead many to believe history will not repeat itself.