A Denver developer and New Jersey gambling regulators made a big bet Thursday on the future of Atlantic City and a casino that flopped four years ago, granting a casino license to the Ocean Resort Casino a week before it is due to reopen.
The property is the former Revel casino, the $2.4 billion pleasure palace at the north end of Atlantic City's Boardwalk. It shut down Sept. 2, 2014, after little more than two years of operation, during which it never came close to turning a profit.
But Bruce Deifik, who bought the casino for $200 million in January, is confident his management team has fixed what was wrong with Revel, including what customers repeatedly said they didn't like about it.
Breaking news and the stories that matter to your neighborhood.
The casino will now allow smoking, single-night stays, offer generous player loyalty benefits, a buffet, and a reconfigured casino floor that makes it much easier to get around. It even put safety panels on either side of the vertiginous escalators that made many patrons uncomfortable.
But perhaps the biggest change is one in attitude; Revel focused on high-end customers, who never showed up in sufficient enough numbers to offset the crushing debt its original owners incurred.
Ocean Resort, by contrast, will welcome all customers.
"If you're someone betting $5 or $10, how often does someone come up to you, shake your hand, ask how your day is coming and ask if there's anything you need?" asked Frank Leone, Ocean Resort's CEO. "We are going to ensure that customers who don't get personal attention at other properties get personal attention here."
Leone said Revel deviated from casino industry best practices in many important ways, including meager or non-existent comps and discount offers. He said a player who lost $10,000 gambling at Caesars might get as much as $4,000 of that back through comps or incentives to return to the property. That same customer at Revel not only lost $10,000, but was handed a $1,000 bill for hotel and food and beverage charges, Leone said.
"It's simple economics," he said. "Milk is $3 a gallon. You can't sell it for $5.40 a gallon when everyone else is charging $3."
One of the conditions imposed by state gambling regulators is that Ocean Resort maintain at least $36 million of liquidity at all times, a condition to which the casino agreed.
Ocean Resort will offer internet gambling beginning July 1.
It is due to open at 1 p.m. on June 28, moving its opening ceremony up by two hours to accommodate a request by Gov. Phil Murphy to place the first sports bet at the casino's new sports betting lounge. Two hours earlier, Murphy will be a few hundred yards up the Boardwalk at the opening of the Hard Rock casino, which used to be the Trump Taj Mahal.
The two newly reopened casinos will restore more than 6,000 of the 11,000 jobs that were lost since 2014, when five of Atlantic City's 12 casinos shut down. By the end of next week, there will be nine operating casinos in Atlantic City.
The reopenings are already generating increased economic activity in a section of the Boardwalk that was largely dark for the past four years. The Showboat, the former casino between Ocean Resort and Hard Rock that has been operating as a non-gambling hotel since July 2016, announced Thursday it will open all 1,331 of its hotel rooms starting June 28. It had been opening just 852 of them in recent years.
"This is an exciting time for us," said Bart Blatstein, president of Tower Investments, which owns the Showboat. He said the company "has embraced the opportunity of investing in Atlantic City and we've expressed faith in the resort's renaissance when other investors were running away."