A common word thrown around by Bruce Deifik is “renaissance.”
The Ocean Resort Casino owner, though, does not use that word lightly. He believed Atlantic City was on the threshold of rebirth.
His property, along with Hard Rock Atlantic City, both of which opened June 28, was expected to be the catalyst for the city’s return to prominence.
Now, six months after the two properties opened to the public, Deifik has not wavered from that frequently used word.
“Looking back, I felt that Atlantic City was going through a renaissance,” Deifik said in a phone interview.
“I believe, absolutely, that that is continuing in a very strong way, that there’s a very good foundation that’s being built under our feet in Atlantic City, and that the future looks very, very bright.”
Certainly, both Ocean Resort and Hard Rock AC remain in their infancy.
But both have enjoyed revenue upticks since activating amenities such as NJ online gambling, and, in the case of Ocean Resort, NJ sports betting. (Hard Rock expects to join the wagering industry within the first quarter of 2019.)
Yet while the industry as a whole continues to reach unprecedented levels of success, Ocean Resort and Hard Rock remain far behind in terms of revenue.
Of course, there is always room for improvement. Yet neither property is concerned about its standing and current state.
Atlantic City on the rise
It has been some time since Atlantic City had the spotlight. The advent of sports betting surely infused some hype. And that industry has made its fair share of contributions.
Sports betting and an eye-opening upturn in NJ online casinos — which accounted for the majority of a state-record $26.9 million in November, the fourth month this calendar year in which revenue records were set — have indeed led to a renaissance in Atlantic City.
According to the New Jersey Division of Gaming Enforcement, spending and gambling revenue is on pace to eclipse last year’s figures. In the third quarter, net revenue industry-wide reflected a 17.8 percent increase (although gross profits represented a 15.3 percent decrease year-over-year).
And November marked the sixth straight month, and the seventh overall, in which total gaming revenue for Atlantic City casinos showed a year-over-year spike.
“The opening of two new casinos in late June plus the advent of sports betting at the same time explains the surge in net revenues in the third quarter and increase in total industry gross gaming win through October,” analyst Tony Marino told the Press of Atlantic City. “The publicity and media interest accompanying the new casinos and the long-anticipated legalization of sports betting was intense and came at the perfect time — the beginning of Atlantic City’s historically robust summer season. In other words, the timing could not have been better.”
Rummy Pandit, executive director of the Lloyd D. Levenson Institute of Gaming, Hospitality & Tourism at Stockton University, also spoke with the Press of Atlantic City:
“Sustained growth in the lodging segment demonstrates the resilience of Atlantic City as it continues its transformation from a gaming-centric market to a multifaceted destination resort on the East Coast.”
Consider, though, that this year’s monthly numbers, at least since July, compare to a time when Atlantic City was lined with seven casinos rather than nine.
And on an individual-casino basis, the newcomers have some catching up to do.
Ocean Resort, Hard Rock behind but thriving
Naturally, both new Atlantic City casinos were behind the eight ball upon opening.
Since rolling out their respective online casinos — Hard Rock in June and Ocean Resort the following month — both platforms have gradually upped revenue each month.
From its first full month of online casino operations, Hard Rock has gone from a $329,650 month in July to $1,314,597 last month. Ocean Resort has also grown, though not as exponentially: $249,805 in July (not a full month) to $731,887 in November.
Granted, month-to-month revenue reports vary and fluctuate.
Yet in that same span, while Ocean Resort and Hard Rock have increased revenue each month, most others have seen dips in profit. Perhaps this is an example of the two new properties gaining customers. Though that is speculative.
Pandit told the Press of Atlantic City that three months worth of data is not sufficient to draw solid conclusions.
He added, however:
“But, if Atlantic City’s past history has taught us to be realistic, we should anticipate that total year round demand may not be sufficient to keep all nine casinos profitable by 2020 and beyond. Without major infrastructure changes and effective marketing programs, another round of right-sizing the casino industry is likely in Atlantic City’s future.”
Ocean Resort owner not concerned
Ocean Resort and Hard Rock NJ gambling sites remain far behind the competition. Golden Nugget online casino has hovered around $9 million per month since July, while most others remain in the $3 million-to-$4 million range.
Even so, while some experts believe nine casinos cannot successfully operate simultaneously, Deifik does not share similar worry.
“We’re very pleased — my wife, my kids, myself, our executives,” Deifik said. “We think we get better every day. We’re making good decisions every day. We have great partners. I couldn’t be happier. If you would have asked me June 28, when we opened, ‘Where would you like to be toward the end of the year?’ I’m pleased where we’re at.
“It’s amazing. You see the town getting better every day. You see the small business owner getting better every day and coming back to life. … It’s a great thing to see that things are getting cleaned up.”
Success about more than just casino
There’s another phrase Deifik likes to use:
“We could not be happier.”
Since opening, the owner said, Ocean Resort has operated at about 84 percent occupancy, second only to Borgata. That gap will narrow further, Deifik noted, when another 2,000 rooms are completed at Ocean Resort.
Hotel operations have run relatively smoothly, Deifik said, emphasizing the success of group and convention at the resort. The casino features more than a dozen food and beverage options and non-gaming amenities such as Topgolf.
Pandit told the Press of Atlantic City that both Ocean Resort and Hard Rock are “finding a niche within non-gaming market segments” while filling up their calendars with live music and comedy acts, among other things. (Hard Rock did not respond to interview requests.)
In Las Vegas, Pandit mentioned, casino hotels generate more revenue from those non-gaming activities. He said Atlantic City properties should emphasize the same in order to survive.
Deifik has begun such a model.
“Las Vegas should be very proud with the way they’ve done things,” Deifik said. “I’m a student of that town for 30 years, basically. … I’ve watched and I’ve looked. We could do worse things than to emulate, to a certain extent, what they do in Las Vegas as far as group and convention and filling up your properties all the time every day. That’s a great thing.
“I think that you always follow people when they make great decisions. And Las Vegas has absolutely created a wonderful model; it’s a wonderful place.”
While some experts may appear concerned, or at least wary of, casino cannibalism, Deifik (and surely Hard Rock executives) perceive an influx in visitation in the near future.
The Ocean Resort owner says that 24.5 million people flock to Atlantic City annually. If that number reaches 30 million visitors, all nine properties should not only thrive but also grow.
“I think Atlantic City has that opportunity. I think we’re heading slowly in a direction where people say, ‘You know what? Let’s go there.'”