New Jersey Casino Closes For GoodAtlantic Club Casino Hotel No More As Of Monday |
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The Atlantic Club Casino Hotel, once the coveted prize of PokerStars, closed its doors Monday morning.
It will not re-open.
The casino was a disaster financially, filing for bankruptcy this past fall.
Opening in 1980 as the Golden Nugget, the casino subsequently went through several owners and re-brandings. In 2005, hedge fund Colony Capital bought the property for around $500 million. It seems fair to say the group really regrets that purchase.
Colony Capital was at one point prepared to sell it to PokerStars for a comparatively measly sum of $15 million, however the deal collapsed amid a whole whirlwind of drama. PokerStars — whose one-time chief is under federal indictment — still hasn’t been found suitable to run online poker in New Jersey. PokerStars’ plan to buy the Atlantic Club was vigorously opposed by the American Gaming Association, the U.S. commercial casino industry’s top lobbying group. Its members include the likes of Caesars Entertainment. The AGA claimed that PokerStars “operated as a criminal enterprise for many years." PokerStars settled with the federal government but didn’t admit any wrongdoing.
Even when it wasn’t the subject of a bitter dispute within the gaming industry, the Atlantic Club was still an abyss. The property’s assets were eventually bought by Caesars and Tropicana Entertainment, who will quickly gut the carpet joint.
The closure marks the loss of around 1,600 jobs, according to the Associated Press.
The Garden State legalized online gambling nearly a year ago to help stop the bleeding and prevent casino closures, but apparently it was too little too late for the Atlantic Club. One former casino executive told the Associated Press that more closings could be on the horizon.
New Jersey debuted online gambling in late November, so the industry is still in its infancy. In other words, the new revenue stream hasn’t been open too long.
There is a bitter debate within the gaming industry as to whether online gambling will weaken or strengthen the brick-and-mortar side of things. If more Atlantic City casinos close, despite the state having online gambling, it might give the anti-online gambling camp some more ammunition, most notably Sheldon Adelson, who thinks web games will be a detriment to the core of his business. It’s worth noting that not every casino in Atlantic City has web gambling.
The precise reason for shrinking gambling revenues in Atlantic City? It’s really hard to say.
Most seem to attribute it to bolstered gambling industries in nearby states (most notably Pennsylvania), which seems to have resulted in decreased interest in New Jersey gambling. It could also be partially due to people being poorer and not having as much to spend at casinos. There was, after all, a major economic crisis in or around 2008. Atlantic City started sliding in 2006, though. Twelve casinos for the area might have just been too many for the area to handle long-term in most economic climates. Finally, maybe top casino firms saw more lucrative investments elsewhere (Macau, for example) and thus scaled back on their New Jersey dealings. At any rate, the fact is that the Atlantic Club is no more — and it wasn’t too surprising.
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