A looming threat hangs over Atlantic City’s casinos, as three new casinos are planned to be built in New York, which experts believe could lead to decreased revenue and even casino closures. Panelists at a recent casino industry conference have expressed their concerns, predicting a 20% to 30% decline in revenue for Atlantic City’s casinos as a result of the new competition.
Jim Allen, chairman of the Hard Rock casino, entertainment, and hospitality company, believes that at least one of the casinos in Atlantic City will have to close due to the New York casinos, though his company is one of the bidders for a new casino license. Hard Rock Casino, Borgata, and Ocean Casino Resort are among the casinos with the highest revenue from in-person gamblers in New Jersey, but Allen is concerned about other casinos.
Wall Street analysts are also aware that the opening of the new New York casinos will have a significant impact on Atlantic City’s gaming industry. While Wells Fargo’s managing director, Duane Bouligny, believes that good leadership and future investments will enable some of the casinos to expand, he acknowledges that others will have to be right-sized or closed.
However, a gambling historian at the University of Nevada Las Vegas, David Schwartz, sees an opportunity for Atlantic City’s casinos to expand their offerings and attract New Yorkers to drive down to Atlantic City. He suggests diversifying amenities and focusing on superior customer service for gamblers to offset the convenience of “local” casinos in New York.
While the report indicates that the revenue earned from sports betting and online gambling is not entirely owned by the casinos, the inclusion of that money in the report may lead to misunderstandings. Last year’s report showed a decrease in retail casinos’ revenue. Atlantic City is providing visitors with more than just gambling, including hotels, restaurants, entertainment, conference spaces, shopping malls, personal care amenities, and a new water park that is soon to be opened.
The licenses for the new New York casinos have yet to be awarded. Nevertheless, Jim Allen warns, “If we lose 20 to 30% of our business, it is not going to be a great day for Atlantic City.”
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