Panelists at a significant on line casino trade convention mentioned the development of three new casinos in New York might price Atlantic Metropolis 20% to 30% of its on line casino income, a growth that would probably return the resort to the times of on line casino closures.
Whereas not predicting that it’s going to positively occur, Jim Allen, chairman of the worldwide Laborious Rock on line casino, leisure and hospitality firm, on Thursday mentioned that such a income drop may lead not less than one Atlantic Metropolis on line casino to shut. Laborious Rock, which owns a on line casino in Atlantic Metropolis, is among the many bidders for a New York on line casino.
Talking on the East Coast Gaming Congress, Allen warned that New York’s coming casinos may have an enormous impact on Atlantic Metropolis.
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“It might occur,” Allen advised The Related Press in an interview after his speech. “Atlantic Metropolis receives 20, 30-plus p.c of its income from upstate New Jersey and downstate New York, and there is not any doubt it’s going to have an effect on this explicit market.”
Allen’s Atlantic Metropolis on line casino, together with the market-leading Borgata, and the Ocean On line casino Resort are at present the highest performing casinos out there when it comes to cash received from in-person gamblers.
“So you’ve three or 4 which might be very robust after which I feel there is a query as to what occurs in that subsequent degree down,” he mentioned. “I feel its a priority that if these different casinos do not carry out, then inevitably from a enterprise standpoint, is there vulnerability? I do not suppose that adjustments except there’s enhancement to the notion of Atlantic Metropolis.”
Allen has been a frequent critic of situations in Atlantic Metropolis, together with perceptions of cleanliness and security for guests. He acknowledged progress has been made, however mentioned extra stays to be accomplished.
Mark Giannantonio, president of Resorts On line casino and of the On line casino Affiliation of New Jersey, declined touch upon Allen’s remarks.
On the similar convention on Wednesday, a number of Wall Road analysts additionally predicted New York casinos will take a chunk out of Atlantic Metropolis’s enterprise.
Duane Bouligny, managing director at Wells Fargo mentioned Atlantic Metropolis casinos that proceed to spend money on their companies and have good management will develop.
A prime on line casino trade panel estimates that the development of three new casinos in New York might take away as much as 30% of Atlantic Metropolis, New Jersey’s income. (AP Picture/Wayne Parry)
“Those that do not will get right-sized or shut out of the market,” he mentioned, including “that is going to be a really lengthy course of.”
David Schwartz, a playing historian with the College of Nevada Las Vegas, mentioned rather a lot will depend on how Atlantic Metropolis’s 9 casinos react to the brand new competitors.
“Whereas it’s attainable that a number of casinos might fold their tents and exit the market, there may be additionally a chance for casinos to broaden their choices and provides New Yorkers a motive to drive all the way down to” Atlantic Metropolis, he mentioned. “In any case, tens of millions of people that dwell inside a brief drive of casinos fly to Las Vegas yearly. Diversification of facilities and a deal with superior customer support for gamblers would possibly offset the comfort of ‘native’ casinos in New York.”
Allen mentioned the income numbers reported by the state every month give a deceptive image by together with sports activities betting and web playing income. That cash have to be shared with third-party suppliers and isn’t solely for the casinos to maintain.
The casinos’ key enterprise, cash received from in-person gamblers, “has been going backwards or flat, relying on the property, since final Might,” he mentioned.
Atlantic Metropolis has been attempting for years to diversify its enterprise mannequin to make it much less reliant on playing. That has included investments in new lodge rooms, eating places, leisure and convention venues, and purchasing and private care facilities.
A $100 million year-round water park is because of open this yr, and Caesars Leisure is including a brand new leisure venue and a Vegas-style residency present.
A choice on who’s awarded licenses to construct the casinos shouldn’t be anticipated till someday later this yr.
Laborious Rock had introduced plans to develop a on line casino within the northern New Jersey Meadowlands, simply outdoors New York Metropolis, earlier than a statewide referendum on the subject was resoundingly defeated by voters. He mentioned Thursday the plan “remains to be there,” however mentioned Laborious Rock, like everybody else, is “attempting to guage the panorama. It relies upon upon the chance.”
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Allen famous there aren’t any present plans for one more referendum on a north Jersey on line casino, and mentioned he was not conscious of any sentiment amongst state lawmakers to revive the difficulty within the close to future.
Jeff Gural, who runs the Meadowlands Racetrack the place a Laborious Rock on line casino can be constructed, mentioned New York casinos “would make it simpler for me to get a on line casino within the Meadowlands.”
“I am unable to think about individuals would suppose driving over the George Washington Bridge, paying $18 in tolls and sitting in site visitors is preferable to going to a on line casino within the Meadowlands,” he mentioned.
Allen used a play on Atlantic Metropolis Mayor Marty Small’s signature line that it is “an awesome day in Atlantic Metropolis” in describing the risk from New York casinos.
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“I can let you know this: If we lose 20 to 30% of our enterprise, it’s not going to be an awesome day for Atlantic Metropolis,” he mentioned.
