Posts tagged atlantic city

World War One and Atlantic City

In response to this photo and Bat-Signal request for more info, I wanted to post a link to an Atlantic City history column I’d written for Casino Connection a few (nine) years back. Turns out that it’s one of the 10 or so AC history pieces not in the Casino Connection archives.

Looking at the sixty or so articles I wrote for Casino Connection over the years, I think I have the core of a pretty good book. But some articles will need some revision, both for content and style.

So here is the entire article, which has the answer to the original question, “What is this?”…after the jump.

Continue reading World War One and Atlantic City

Atlantic City’s Last Great Hope? in Vegas Seven

I’ve got something besides today’s Green Felt Journal in today’s Vegas Seven: a look at Revel, Atlantic City’s latest casino:

Revel, Atlantic City’s first new casino in nearly a decade, has been called “Cosmopolitan East,” for its similarities, real and supposed to the Cosmopolitan of Las Vegas. Like the Cosmo, it’s put a great deal of emphasis on its non-gaming amenities, and, like the Cosmo, it’s struggled on the casino floor. In June, Revel’s win per slot per day—a valuable metric of casino performance—was the lowest in the city.

via Atlantic City’s Last Great Hope? | Vegas Seven.

This week’s news about Revel seeking more credit only underlines the point that the casino is underperforming.

My Boardwalk Homecoming in Vegas Seven

I’ve got a very special Green Felt Journal out in today’s Vegas Seven. No, it’s not like a “very special episode” of Diff’rent Strokes or The Fact of Life that’s going to pontificate on a current social issue. Instead, I’m talking about the usual stuff I talk about in that space–gambling, casinos, and tourism–but in a much more personal way than I usually do. Here’s a snippet:

The Atlantic City I left was on the other side of history: a city left for dead, one that maybe, someday, might come back. Like Las Vegas, it blew up its past; some of my earliest memories were the implosions of the grand Boardwalk hotels. But this wasn’t replacing the Dunes with Bellagio. Old Atlantic City—the Traymore, the Marlborough-Blenheim, Million Dollar Pier—hadn’t been improved upon; gold had been replaced with concrete and red neon, when anything was built at all. Unlike Las Vegas, you never could shake the sense that you were one or two generations from the golden age.

via A Boardwalk Homecoming | Vegas Seven.

I usually don’t get that autobiographical, because there’s usually not that much of a need for me to put myself into the story. After all, it’s usually pretty straight-forward stuff–a personality profile, a sketch of a current issue–that calls for, at most, some editorial comment, but not much personal reflection.

So this is a different kind of writing for me, but for this story, it’s a path that I had to take. If it succeeds, it’s largely due to the unstinting support and fantastic sounding board of my editor, Greg Blake Miller.

On a more (literally) pedestrian note, I’ve also got some thoughts on Revel over on Two Way Hard Three. I liked the place, quite a bit, but there were a few things that left me scratching my head.

Atlantic City double shot in Two Way Hard Three

In case you missed it, I’ve recently posted two Atlantic City-related pieces on Two Way Hard Three. The first is the complete text of my answers to questions Wayne Parry asked me about Atlantic City:

The AP’s Wayne Parry wrote an excellent article about Atlantic City’s rise and fall. He reached out to me for my thoughts, and I answered several of his questions. Obviously, with space constraints being what they are I figured most of what I said wouldn’t make it into the story, so I planned to post it here so I could share my thoughts with a broader audience. You can see many of the numbers I reference in my Atlantic City Gaming Revenue (pdf) report.

Here are his questions and my responses:

via Some thoughts on Atlantic City | Two Way Hard Three | Las Vegas Casino & Design Blog | from ratevegas.com.

Last week, I decided to gloat a little and revisit a past prediction I made about mini-casinos and Trump Marina:

Landry’s Inc. a Houston-based company that owns a full spread of restaurant chains and Downtown Las Vegas and Laughlin’s Golden Nuggets, has officially taken ownership of the now-former Trump Marina and will be putting about $100 million into renovating it. Meanwhile, a vaunted plan to allow “mini-casinos” has resulted in exactly zero construction to date. That’s exactly what anyone would have predicted when the mini-casino concept was first mooted, and it’s a good sign that some operators, at least, see some upside in the market.

Landry’s takeover just as predicted | Two Way Hard Three | Las Vegas Casino & Design Blog | from ratevegas.com

I mixed together some history and numbers stuff, which seems to be the way most of my work is going these days. Fun stuff. I still don’t see how the mini-casinos make sense if they cost more than full-sized casinos and have less revenue potential.

Finally, I had some fun this weekend and tried to answer the question Where should the Vegas Internet Mafia have its picnic?

I know I’m no Misnomer when it comes to the comedic stuff, but I figured it was worth a shot.

I promise that, later this week, I’ll be delivering something that is a) mostly serious (and harmless) and Vegas-related. It’s already in the works, but I want to take some time with it.

Landry’s Marina takeover talk in Two Way Hard Three

If you’ve missed it, I’ve got a post up at Two Way Hard Three that explains Landry’s purchase of Trump Marina and the return of the Golden Nugget to Atlantic City, with some bonus historical context:

Landry’s Inc. a Houston-based company that owns a full spread of restaurant chains and Downtown Las Vegas and Laughlin’s Golden Nuggets, has officially taken ownership of the now-former Trump Marina and will be putting about $100 million into renovating it. Meanwhile, a vaunted plan to allow "mini-casinos" has resulted in exactly zero construction to date. That’s exactly what anyone would have predicted when the mini-casino concept was first mooted, and it’s a good sign that some operators, at least, see some upside in the market.

via Landry’s Marina takeover just as predicted | Two Way Hard Three | Las Vegas Casino & Design Blog | from ratevegas.com.

Since I wrote it, I’ve seen two stories, one of which confirms something I said. Trump Plaza is potentially on the market, which I alluded to in the TWHT piece. Second, Hard Rock is apparently about to pull permits to build a $300 million mini-casino at Albany Avenue and the Boardwalk–right across from the site of the old Atlantic City High School.

I spent a lot of time in my TWHT piece talking about what a lousy idea that was, and I haven’t seen anything to convince me otherwise. When you can get 1,000 rooms and 2,000 slots in a totally renovated building for $138 million, why would you pay $300 million for one-quarter or less of a facility–200-500 rooms with about 510 slots? I ran the numbers and I just don’t see how it could possibly be profitable.

If anyone has an explanation, I’m willing to listen. It’s totally possible that I’m missing something here, but it’s also possible that I’m not. Back in 2007 there were a lot of smart people who thought Strip condos were a can’t-lose proposition, so I’m not so sure that, just because someone can borrow hundreds of millions of dollars they’re smart enough to spend it.

Atlantic City changes

Looks like change is in the air in Atlantic City. First off, Trump Marina is apparently going to change hands. As the Atlantic City Press reports, Landry’s Inc., which owns Golden Nuggets in Downtown Las Vegas and Laughlin, is planning to buy the property for $38 million and give it a through facelift, both inside and out. If the Press’s photo of a rendering is any guide, this will really revitalize the casino and add another must-see property to the Marina district.

I think there’s a lot that Landry’s can do with the Trump Marina. For one, they’ve got the marina right there, which is really a unique asset. I could see them doing something like The Tank at the property, and their seafood-based brands, like Chart House at the high end and plenty more at the lower end, are a natural fit.

The other big news is that the Atlantic City Hilton is officially for sale (again, courtesy of the Press). Anyone want to scrape together $30 million or so and put in a bid?

Looking at the chronology, I realized something. The property was known as the Golden Nugget for about 7 years (late 1980-1987), Bally’s Grand/The Grand (A Bally’s Casino Resort) for about 9 years, and the Atlantic City Hilton from 1996 to today, about 15 years. But it’s still “the Nugget” to me.

It seems like the market has really corrected in Atlantic City, and with bottom-of-the-market casinos now going in the $30-$40 million range and regulatory reform becoming a reality, we might see regional operators kicking the tires.

Anyone remember back in 2007, when the Casino Control Commission thought someone would pay $1 billion for the Tropicana? How times have changed.

A new hope for AC? in the Las Vegas Business Press

In this week’s Las Vegas Business Press, I share my thoughts about the just-passed Atlantic City casino regulatory reform:

After suffering its fourth consecutive year of declining casino revenues, Atlantic City might finally be feeling the winds of reform. But will a planned regulatory overhaul be too little, too late to save the city’s slumping gaming industry?

First, a look at where Atlantic City is today. After about 20 years (1986-2006) of steady growth at an annual rate of more than 4 percent, the city’s casino revenues began to nosedive in 2007 — a year before Nevada’s revenues started to slip. Although Nevada is on pace for a slight gain in revenues for 2010, Atlantic City suffered another nearly double-digit decline.

via Las Vegas Business Press :: David G. Schwartz : Casino-rule reforms may offer Atlantic City hope.

The interesting thing is to look at Atlantic City’s historical growth. From 1978 to 1985, when the industry was adding casinos, there was incredible growth. After that, it was decent, just about outpacing inflation for the next twenty years. Table play, however, stagnated. Since 2007, both table and slot play have plunged.

So it’s a problem that goes beyond the recession and beyond the internal working of the state’s regulatory structure. By itself the reforms won’t save the city’s gaming industry, but they might be the first step in the right direction.

Big Six under study

My latest report is up over at the Center for Gaming Research. It’s a look at why Big Six is such a great game–for the house:

Big Six is a minor casino game, but one that has high visibility on most casinos floors. Positioned where it is easily accessible by casual and novice gamblers, the game offers payouts as high as 45 to 1. But all of the bets, particularly, the longshots, have relatively large advantages for the house, ranging from about 11% to over 24%. The game is one of the worst bets on the casino floor for gamblers.

Looking at field results from a single table in an Atlantic City casino over four years, it is clear that this is a wheel that spins predominantly to the house’s, rather than player’s, advantage. The average win percentage of 42.25% for the period examined explains why seasoned gamblers avoid this game.

BIG SIX: A LONGITUDINAL MICRO-STUDY

I’m glad I took a look at the game–it didn’t take long, and it’s nice practice for testing assumptions a little more controversial than “Big Six isn’t such a great game.”

I fully expect to get several emails from outraged Big Six players, telling me how they’ve won hundreds of dollars on the game over the years.

If you’re in this boat, and are getting ready to email me to tell me I “got it wrong” about this game, here is the offer I’ll make: if you can replicate your winning formula for Big Six in a casino with me or another representative watching and recording all of the details for your bets over several hours, I’m willing to test your theory. If you’re right, we will have found something new.

Inside the NJ casino overhaul

As promised, I’ve taken a deeper look at the recent casino regulatory overhaul that passed the New Jersey legislature. My comments are based on version of the bill that was current as of 1/10/11. You can find it right here.

First of all, the bill codifies into law the current existential angst the industry is facing:

(18) As recognized in the July 2010 Report of the Governor’s Advisory Commission on New Jersey Gaming, Sports, and Entertainment, and as confirmed in subsequent legislative hearings held throughout the State, legalized casino gaming in New Jersey presently stands at a crossroads, facing critical challenges that jeopardize its important role in the State economy, and it is in the public interest to modernize and streamline the current outdated casino regulatory structure in order to achieve efficiencies and cost savings that are more appropriately directed to marketing and infrastructure improvement efforts while, at the same time, maintaining strict integrity in the regulation of casino operations.

(19) The ability of the legalized casino gaming industry in New Jersey to compete in an ever-expanding national gaming market requires a regulatory system that is sufficiently flexible to encourage persons and entities holding casino gaming licenses outside of New Jersey to participate in casino gaming in Atlantic City, to allow licensees to take full and timely advantage of advancements in technology, particularly in information technology, and business management, and to encourage the efficient utilization of resources between and among affiliated New Jersey licensees operating casinos located in Atlantic City and between and among a New Jersey affiliate and its licensed affiliates in other jurisdictions.

There are some small but interesting changes throughout the bill.

It broadens the definition of “family” to include domestic partners and partners in a civil union in addition to the traditional array of blood and marriage relations.

Non-cashable credits are explicitly defined as “not gross gaming revenue,” and therefore not taxable/

Adds a definition:

Multi-casino employee” – Any registered casino employee or licensed casino key employee who, upon the petition of two or more affiliated casino licensees, is endorsed by the commission or division, as applicable, to perform any compatible functions for any of the petitioning casino licensees.

Which suggests we’ll be seeing more cross-staffing in multiple-owner casino groups.

The bill changes virtually every mention of “commission” in the existing Casino Control Act to “division,” reflecting the big shift in regulation.

The bill gives the following responsibilities to the Division of Gaming Enforcement:

conducting investigative hearings on the conduct of gaming and
gaming operations and the enforcement of the casino control act;
issuing reports and recommendations to the commission on entities or persons required to qualify for a casino license, on applications for interim casino authorization, or on petitions for a statement of compliance;
examining records and procedures, and conducting periodic
reviews of operations and facilities, to evaluate provisions of law;
collecting certain fees and assessments;
issuing operation certificates to casino licensees;
accepting impact statements submitted by casino license applicants;
issuing emergency orders;
taking action against licensees or registrants for violations of the act;
imposing sanctions and collecting penalties;
accepting and maintaining registrations for casino employees and certain vendors;
receiving complaints from the public;
certifying the revenue of a casino or simulcasting facility;
creating and maintaining the list of excluded patrons;
and
using private contractors to process criminal history record background checks.

The Commission still actually issues licenses and hears appeals on Division decisions. One notable change: neither DGE agents nor Commission inspectors will have to be present in casinos anymore. I wonder what they’ll do with the CCC podiums in the casinos. Taking a cue from Vegas casino party pits, I suggest “cage dancers.” Bonus points if they dress in Commission garb before stripping it off. Extra bonus points if a patron interrupts their dance to file a dispute.

The Commission also loses the right to have an in-house legal counsel, and instead has to contract that work out.

The Division’s office must be in Atlantic City, although it’s allowed to have a secondary office in Trenton, too.

The amount of fines are doubled.

From its signing, the CCC has 90 days to make an “orderly” transfer of its powers to the DGE.

The moves will have a definite fiscal impact, but according to the fiscal estimate, the exact impact can’t be determined yet. The Office of Legislative Services offers some good reasons why:

It should be noted that estimating the cost or possible savings to the Casino Control Fund resulting from the transfer of various regulatory functions from the CCC to the DGE would require the Executive Branch to provide a strategic reorganization plan that details the functions and regulations being transferred and any changes in scope and importance of those functions and regulations. In addition, an estimate of the costs or savings would require the Executive Branch to provide a workload analysis describing how the functions that are transferred will be handled by the DGE in terms of staffing and position restructuring. For example, will the DGE hire new employees to perform the transferred functions, will the existing DGE staff absorb the new job duties by having their job duties expanded to include the new functions, or will some functions be eliminated entirely? Furthermore, because the bill changes the language in current law requiring the DGE to be principally located in Atlantic City, will the State incur new building or facility costs?

In other words, it’s anyone guess how all this will play out. It could save money, but it might cost money in the short term.

Inside the NJ Internet gambling law

You might not have heard, but the New Jersey legislature voted to legalize Internet gaming. The bill in question (S490) passed both houses and awaits Governor Christie’s signature. So what does it mean?

The new law changes the Casino Control Act to permit Atlantic City casinos to offer gambling over the Internet to residents of New Jersey and those who live outside the United States.

To play, gamblers must first establish an account with the casino.

The computers, servers, monitoring rooms, and hubs must be housed in a “restricted area” in a casino or in an off-site location that is still in Atlantic City.

Things get tricky with taxation. There’s a gross tax on wagers of 8% (same as for regular gambling), with a 30% investment alternative tax and a 15% investment alternative–a 52% effective tax rate. According to the bill, CRDA can use that money to support racetracks in other parts of the state.

Within a fiscal year of sports betting being implemented in New Jersey, the investment alternative tax falls to 10%, and the investment alternative to 5%, leaving a much more manageable 23% effective tax rate. Subsidies to the tracks also stop then. Seems like the horsemen have a real incentive to block any sports-betting law, and the casinos have a big incentive to push it.

Applicants have to verify their name and residency before opening an account and gambling.

None of the following people can bet online:
(1) the Governor 1or Lieutenant Governor1;
(2) any State officer or employee or special State officer or employee;
(3) any member of the Judiciary;
(4) any member of the Legislature;
(5) any officer of Atlantic City; or
(6) any casino employee, casino key employee or principal employee of a casino licensee.

Bad news for casino employees who were hoping to unwind by playing legal online poker in their off-hours. This seems a bit onerous.

If money in an account sits dormant for too long (a period that’s not specified in this law), the casino must contact the holder (“by mail, phone, and computer”) and, if it doesn’t get a reply, must close the account, with 50% of the account’s value going to the state, 50% to the casino. Didn’t Christie suggest stores do this with gift cards, too?

There are some problem gambling controls:

The words “If you or someone you know has a gambling problem and wants help, call 1-800 GAMBLER,” or “some comparable language approved by the commission, which language shall include the words “gambling problem” and “call 1-800 GAMBLER,”” must be “prominently and continuously displayed to any person visiting or logged onto Internet wagering.” It’s like a surgeon general’s warning on cigarettes; hopefully it has more impact.

An account holder can establish a loss limit, beyond which he can’t gamble anymore, or cap his max bet, or suspend his account temporarily or permanently. While in suspension, casinos can’t market to him.

There’s a lot of material in the bill that hasn’t been widely reported on–I suggest you read it for yourself.