After a quarter century beneath the spotlight of the Atlantic City casinos scene, Showboat Casino has finally decided to close its doors. Over 5,000 employees were laid off and left on the street. The signs on the casino doors say “Closed”.
Residents say they are prepared, whether it is a natural disaster or an economic one. “We didn’t go under from Sandy, we won’t go under from this either.”
The spirit and strength of Atlantic City residents are yet to be tested, as two more casinos were reported to close this month.
After only two years in operation, one of the most expensive casino projects – the Revel Casino Hotel started preparations for closure. Its casino closed early this morning. Its initial plan to invigorate the sliding gambling market of Atlantic City and New Jersey as a whole hit a brick wall as the Great Recession hit right after its opening.
Even the construction of the second hotel tower was cancelled, as the casino owners struggled to obtain the last $1 billion when the project ran out of money half way through. Amassing debts before it was opened, the casino went through two bankruptcies, the second one being fatal.
Analysts explain that the reason for Revel Casino Hotel’s imminent downfall were bad timing, and poor management decisions, such as wrong profiling and analysis of the Atlantic City gambling consumer. For example, there were no bus trips from and to the casino, in addition to no buffet or players’ club.
By the time these mistakes were resolved, the ship was already sinking. Other experts say that the city was not prepared for the type of customers Revel Casino Hotel focused on. On the other hand, Revel did not concentrate on advertising for their traditional customers of Atlantic City. The fact that the management could not use nationwide databases of gambling clients, such as the networks of Tropicana or Caesars Entertainment also had negative effects.
The design of the buildings were also unappealing to customers. Anyone trying to reach the casino had to go on an escalator to the fourth floor, and there had to wind through circular patterns unlike most other casinos, where linear layout is common.
The senior vice president of Borgata explained that “Revel struggled with the execution of plans to develop their market, as well as with their design, and just a basic understanding of the Atlantic City visitor.” Potential buyers also found major flaws in the design of the resort, finding electricity, cooling and heating expenses too high. A $50-million buyout offer was turned down by the owners.
Revel officials refused to comment on their reasoning behind what caused the demise of this pleasure palace.
There are three casinos closing within a 2-week time frame, Trump Plaza being the third, closing on September 16th. Will New Jersey manage to come out of this downhill spiral, and what is the correct recipe for success, an online legislation, or a transition to other entertainment markets? Only time will tell.
