Celebrating Year One: Hard Rock Success, Ocean Casino Survival
June 28 marks the end of the first year since two once shuttered Atlantic City, NJ casinos rebranded, remodeled, and reopened to the public.
Because they each chose to host grand openings on the same day in the summer of 2018, Hard Rock Hotel & Casino Atlantic City and Ocean Casino Resort are forever linked.
However, from the origin stories to how each property performed in year one, this is a tale of two casinos that are as much the same as they are different.
Between a Trump and a Hard Rock
In 1983, Resorts International began construction on what would become Hard Rock Hotel & Casino Atlantic City more than three decades later. Resorts thought it was building a $250 million casino and hotel called Taj Mahal next to Resorts Casino Hotel.
Five years later, Donald Trump had purchased a controlling interest in Resorts, the Taj Mahal budget had ballooned to more than $930 million, and no end to the construction was in sight.
After struggling to raise the $550 million needed to complete the project Trump found himself in a battle for control of Resorts with TV producer Merv Griffin.
In November 1998 they reached a settlement. Griffin got Resorts International and Trump the Taj Mahal.
Trump finally opened Trump Taj Mahal to the public on April 2, 1990. The final construction price tag was $1.2 billion.
The 120,000-square-foot casino was the biggest in the world at the time. Just 15 months after opening, Trump Taj Mahal filed for Chapter 11 bankruptcy protection.
However, it still managed to spend the next decade-plus as the top-grossing casino in Atlantic City. Then, Borgata Hotel Casino & Spa opened in 2003.
Things went downhill for the Taj after Borgata came in and changed the Atlantic City casino landscape.
The Ichan era
By 2014 Trump was out and Billionaire financier Carl Icahn struck a deal to take over ownership with the property emerging from bankruptcy again.
Two years later, Trump Taj Mahal hotel staff went on strike. Union and management had failed to come to an agreement on wages and benefits.
In October of 2016, Icahn shut the Taj down while still mired in that labor dispute.
Hard Rock International gets a great deal
Less than six months later, on March 1, 2017, Hard Rock International bought the Taj for just $50 million.
The company then announced plans to spend $300 million renovating, re-branding, and reopening the property as the Hard Rock Hotel & Casino Atlantic City.
Hard Rock had originally targeted Memorial Day weekend 2018 for its grand opening. However, by November officials admitted the cost of the renovation and rebranding had ballooned to more than $500 million. The grand opening would have to be pushed. In April 2018 they finally settled on June 28.
Ocean Casino Resorts path to its own June 28, 2018 opening is as much the same as it is completely different.
Revel in it
Construction began on what was then called Revel in 2008. Much like the Taj, the project was mired in delays and financial issues.
Revel opened the doors on April 2, 2012, 22 years to the day after the Taj. The final construction price tag was $2.4 billion.
It took the Taj 15 months to file for bankruptcy protection, but Revel did it in just 10.
Revel survived only to file for bankruptcy again in June 2014. However, by September of that year, Revel shut down.
The Taj enjoyed a decade at the top of the Atlantic City casino industry and survived for almost two more before it closed. Revel closed its doors just two years after it opened and has never found any measure of success at all.
The Glenn Straub debacle
Six months after it closed, in April 2015, Florida developer Glenn Straub bought Revel out of bankruptcy for pennies on the dollar. Straub paid just $82 million for the $2.4 billion property and soon announced made plans to reopen it under the name TEN.
He missed several reopening dates over the next two years while fighting with state regulators over the need for a casino license.
Finally, Straub sold Revel to AC Ocean Walk in January 2018 for $200 million.
Ocean Resort Casino emerges
AC Ocean Walk and Bruce Deifik, the Colorado developer behind the company, immediately announced plans to rebrand as Ocean Resort Casino.
Ocean Walk and Deifik targeted the summer of 2018 for opening. They also promised they had studied what went wrong with Revel and swore they wouldn’t make the same mistakes.
Deifik ultimately settled on sharing the June 28 grand opening date with Hard Rock. However, the two properties immediately began heading in different directions from there.
Hard Rock succeeds, Ocean Casino barely survives
Ocean Casino Resort revenues were dead-last among Atlantic City’s nine casinos during four of its first five months in operation. Meanwhile, Hard Rock has used name recognition and a star-studded entertainment line-up to become one of the top five grossing casinos in the market.
It isn’t quite competing with front runner Borgata just yet. However, Hard Rock’s revenue of almost $290 million in its first 11 months in operation is up there with second-tier AC properties like Golden Nugget, Tropicana, and Harrah’s.
In the meantime, Ocean Casino Resort has posted just a little over $191 million in total casino revenue during that time. Numbers that put Ocean Casino Resort among the lowest grossing properties in America’s Playground.
Deifik forced to sell
There were rumors of personal financial issues. Plus, Ocean Casino Resort failed to find the immediate success it hoped for. As a result, Deifik was forced to sell in January of this year.
Tragically, Deifik passed away as new owners Luxor Capital Group were finalizing a $70 million investment into the property and assuming majority ownership.
Then, in April of this year, for the fourth time since it was built, the property got a new name. Instead of Ocean Resort Casino, it became Ocean Casino Resort in an effort to place more emphasis on gambling.
So far, the name change has failed to turn things around.
Ocean Casino Resort posted just a little over $17 million in total gaming revenue in May 2019. When you add Resorts Digital’s online gambling revenues to those from Resorts’ brick and mortar casino, only Bally’s Atlantic City grossed less than Ocean Casino Resort last month.
Ocean Casino Resort fixed most of Revel’s design flaws. It improved upon amenities and policies that were unattractive to the Atlantic City market. The changes in ownership also meant the property no longer sat underneath a cloud of insurmountable debt.
However, people still haven’t shown up to gamble there and the lack of revenue reflects that.
People have turned up at Hard Rock.
Joint Anniversary celebrations
As a result, Hard Rock will happily celebrate its success on the pair’s one-year anniversary with a joint fireworks show set for June 27.
In the meantime, Ocean Casino Resort can celebrate the fact it survived year one. However, an overwhelming feeling of trepidation surrounding the property may dampen the mood.
Hard Rock AC President Joe Lupo told NJGamblingSites.com earlier this month they are really happy with year-one. Results include being No. 2 in terms of table games drop and No. 4 in overall AC casino revenue:
“And we are on the heels of some of our competitors who have been in the market for 20 years and have databases 10 times the size of ours.”
Hard Rock must be looking ahead to year two with a realistic sense of optimism. Ocean Casino Resort has high hopes for its second year, and unfortunately, not much else.
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