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Caesars Ponders Closing Atlantic City Casinos?

Discussion in 'Non-Vegas Hotels & Casinos' started by wizard950, May 8, 2014.

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  1. wizard950

    wizard950 High-Roller

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  2. SH0CK

    SH0CK Stylin' and Profilin' Quasi Tech Admin

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    Congratulations Caesars! You just told anyone who is loyal to your hotels in AC to go to your competition for fear of not getting any value for their gambling dollar.
     
  3. leo21

    leo21 VIP Whale

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    Would you rather have this or the virtually no notice the folks in Tunica got? The reality is that contraction makes sense for a lot of the older markets right now unless some genius can figure out how to grow the customer database in a weak economy.
     
  4. ncfatcat

    ncfatcat Low-Roller

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    I don't think they're closing all of them
     
  5. joaks

    joaks Low-Roller

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    The future of the Showboat has been bleaker ever since they spent the renovation money at Ballys. Rumor has had it up for sale since last spring.
     
  6. hammie

    hammie VIP Whale

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    Agreed, I think this is the weakest property among the four. They sold the Clairidge property and it will become a hotel. When one of these four closes it will make it easier for the NJ Legislature to allow gambling in the Meadowlands to tap the 20 million folks in the NYC Metro area and put further pressure on the AC market.
     
  7. NickyDim

    NickyDim VIP Whale

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    NOOOOOOOOOOOOOOOO. Showboat is my favorite place to gamble in AC(Harrahs is my favorite place to stay).

    If they close Showboat, the best for low rollers Caesar's offer in AC, then it's the Tropicana for this gambler. I just wrote off CET in Vegas in favor of Boyd. If they lose me completely, how many others will they lose, as I'm very loyal to CET in AC, and use to be in LV (12 straight trips before switching the last 2).
     
  8. lithium78

    lithium78 High-Roller

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    I play at Showboat when I go to AC, because I enjoy going to shows at the House of Blues on-site. If CET closes Showboat, I will have fewer reasons to go to AC. That would make me sad.
     
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  9. kiwiboy1

    kiwiboy1 Low-Roller

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    4 casino's in AC seems a little over exposed. Closely one of those would seem like a smart decision. They just closed Harrahs Tunica where they were similarly over exposed.
     
  10. paperposter

    paperposter Well-Known Member

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    i would assume they woundnt close showboat as hob draws people in and they a concert venue and the hookers need a place to work.

    harrahs would be the best as its not on the boardwalk and pain in the ass to get to.
     
  11. wizard950

    wizard950 High-Roller

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    CET probably will not close Harrah's because it is the best and newest property of the four in question. Plus, they are constructing a gigantic convention space (400,000 sq ft) I believe to the back of the property.
     
  12. Viva Las Vegas

    Viva Las Vegas Ramblin' Gamblin' Man

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    The Marina district has AC's top casino (Borgata) and Harrah's AC also does well (most revenue among all four CET hotels, third highest in AC behind Borgata). I loved my stay there. Harrah's does well and there is no question of the four CET AC casinos, Showboat is a lock to be the first to go.
     
    Last edited: May 10, 2014
  13. Someone

    Someone High-Roller

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    I can't see this ending well for CET

    they already have one run down shell of a casino they just bought on the idiotic idea that they can buy it and remove the ability for it to be a casino and lower their competition and then sell the building to someone else (who would be stupid enough to buy it without being able to open a casino)

    now they think they will close down another operating property of their 4 and let it sit and rot as well......and if they sell it off most likely whoever buys it will be looking for a steal and will have deep pockets and come in and refurbish in a major way and steal business from others

    of course Revel is out there for the deep pockets crowd as well and no one really seems to want it either

    if CET thinks they will just close it and let it rot along with their other recent purchase don't put it past NJ to force a sale by threatening "monopoly" status on their other 3 properties, threatening CET that they will pull the casino license for the shuttered property FROM CET ONLY and allow new owners to reclaim a casino license which means CET would not be able to reopen it as a casino or jack up the taxes on it so ownership is untenable for CET with some type of "shuttered, but usable licensed facility" tax.......NJ will put the screws to them one way or another

    also more than likely NJ will allow someone to buy the closed Atlantic Club even if CET gets the casino license yanked from it and puts in a "no casino" in the sale agreement and then NJ will just allow them to build a tilt wall building across the street or next door with a sky walk and license a casino right up in it......especially if CET is still sitting on 4 other AC properties and one or more is shuttered
     
  14. Kickin

    Kickin Flea

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    Where did you get those numbers? They don't correspond to the numbers I see from the DGE site. They also have 2013 numbers and the casinos would be ranked as follows:

    Total 2013 Gaming Revenue (in thousands):

    Borgata $616,464
    Harrahs $356,139
    Caesars $336,477
    Taj Mahal $259,965
    Ballys $244,116
    Tropicana $228,022
    Showboat $192,748
    Revel $155,153
    Atlantic Club $141,870
    Resorts $130,406
    Golden Nugget $124,173
    Trump Plaza $73,995

    Showboat is their weakest property by a pretty big margin in terms of gaming revenue. I agree with you all that there is no way they'd close down Harrah's, they consider it their flagship property down there and the marina district is where all the action is nowadays between them and Borgata. And Caesars and Ballys are both doing better plus they're connected and have those synergies between them. Showboat is just the ugly stepchild.

    Its really crazy to see that Revel's gaming revenues were barely more than the now shuttered Atlantic Club. You could have walked by that casino and hardly noticed it, I never even walked into it. Meanwhile Revel is this massive glass behemoth. When they first opened they needed to do at least $30mm per month in gaming revenue just to cover their debt payments. Three years later and they are still at a fraction of that.

    Someone - I'm skeptical as to whether the State will put the screws to CET over shutting down a property. Christie et. al. threw a lot of support behind Revel and helped finance it with taxpayer money (through hundreds of millions in credits) and now it is probably one of the biggest failed casino ventures in history. I think the politicians would rather stay out of it now so they can't be blamed if AC fails.
     
  15. 44inarow

    44inarow VIP Whale

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    As paperposter pointed out, the House of Blues at Showboat is a complicating factor. Remember that they just dumped a bunch of money into it to build out the HoB, add the themed casino, etc. I can't see it closing quite yet, but what I could see is Live Nation pulling out of it, at which point it'd be a no-brainer.
     
  16. Viva Las Vegas

    Viva Las Vegas Ramblin' Gamblin' Man

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    From the last annual report available (2012) from the NJ Gaming Commission, though my numbers were wrong as I misread the chart which I thought was gaming revenue but after a second review I see they were gaming stations (tables and machines). Thanks for point it out (I removed the incorrect statistics).

    I found some interesting data after reviewing the report further:

    1. Gaming revenue per square foot of casino space:

    Borgata $4,435
    Caesars $3,207
    Harrah's $2,420
    Bally's $2,372
    Showboat $2,008

    Golden Nugget $1,864
    Tropicana $1,862
    Trump Taj Mahal $1,827
    The Atlantic Club $1,686 (RIP)
    Resorts $1,351
    Trump Plaza $1,179
    Revel $941

    2. Atlantic City Gaming Revenue 71% (79% in 1989) vs.
    Las Vegas Strip Gaming Revenue 36% (59% in 1989)


    3. 2012 AC Market Share of Casino Win
    1. Borgata 20.0%
    2. Harrah's Marina 13.1%
    3. Bally's 9.7%
    4. Showboat 7.4%
    10. The Atlantic Club 4.3% (RIP)
    11. Revel 4.0%
    12. Trump Plaza 3.4%

    4. Decline in gaming revenue 2012 vs. 2011
    Mini Baccarat -26.7% (Baccarat +10.7%)
    Craps -23.7%
    Blackjack -10.7%
    Total Machines -6.4%


    5. Employees 2009 vs. 2012:
    Bally's 4,360 vs. 3,418 (942 decline)
    Borgata 6,507 vs. 5,936 (571 decline)
    Caesars 3,353 vs. 2,996 (357 decline)
    Harrah's 3,886 vs. 3,924 (38 increase)
    Showboat 2,513 vs. 2,308 (205 decrease)
    Trump Plaza 2,180 vs. 1,117 (1,063 decrease)
    Trump Taj Mahal 4,069 vs. 3,051 (1,018 decrease)

    6. 2012 Occupancy rates & avg room rate per occupied room
    The Atlantic Club 62.7% ($66)
    Caesar's 90.0% ($98)
    Bally's 85.4% ($90)
    Borgata 85.0% ($133)
    Harrah's 83.5% ($96)
    Showboat 82.7% ($91)
    Revel 57.8% ($162)
     
  17. Someone

    Someone High-Roller

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    Christie is no better than what he replaced and what that means is the money poured into Revel is gone, the votes of the construction workers and the current Revel employees have been bought and it is time to forget about that and look elsewhere......Revel has had BK #2 already and may head for #3 sooner rather than later so the failure has come and passed......."what does it matter now"

    it is time for NJ to look to the "future" and that means concentrating on some other group to garner votes from and that is the votes of those that would be out of a job with another casino closure or those that feel they could get a job with a casino reopening

    the "screws" will not really come with a cost it will be sold as coming with revenue.......tax increases on unused, but "functionally capable" properties that makes it impossible for the current owners to sit on shuttered yet usable assets

    NEW MONEY wanting the old Atlantic Club and CET not wanting to sell without the ability to sell with the "no future casino clause" in place and the state allowing that to happen then turning around and rewarding the new owners with a change in laws and rules to make that clause worthless and for the Atlantic Club to be a casino again

    jacking the holding cost of another shuttered casino owned by CET so high that they have to fire sale it where "new money" can't turn down the price because the reality is no one currently in AC wants it

    if those reopened properties wipe out another property (like Revel again) along the way well a those that got the jobs at the reopened properties are happy and in two to three weeks time "what does it matter anyway" for those at Revel losing a job or being "right sized" out of a job

    accentuate the positives and ignore the negatives and scream "haters" or blame "market forces" or "poor operators" and move on
     
  18. hammie

    hammie VIP Whale

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    The Bankruptcy court accepted a bid of $23 million for The Atlantic Club last December, Caesars put up $15 million and got the property. Tropicana put up $8 million and got the slots and players club database. For a company that has $20 billion in debt, I don't think the carrying costs will affect CET in the least. A casino operator could have picked it up for a bargain, the Atlantic Club had just put some money in new slots. Its closure put 1500 employees out on the street.

    I guess there was no "New Money" willing to take the risk.

    I think I read that Trump Plaza was to be sold for around $15 million, but Carl Ichan wouldn't release his lien.
     
  19. lithium78

    lithium78 High-Roller

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    It's a tough market for rock music right now. Young people just don't seem enthusiastic about rock anymore. Rock music hasn't been really popular since the mid 2000s. I really worry about Showboat closing down, even with the House of Blues on site.
     
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  20. paperposter

    paperposter Well-Known Member

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    live nation and hob are the same so if one goes the other goes, they still i guess can run it as a concert venue, cet needs one, they need to draw in people and there other properties dont have a real concet venue except renting out the boardwalk.


    ballys and cesars wont be clossing.

    maybe they wil just burn down dump plaza for the hell of it and call it a public service:thumbsup:
     
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