It was quite a dramatic weekend in Atlantic City.
As New Jersey inches closer and closer to its November 26th online casino launch, PokerStars was rejected (for now) for an Internet gaming license in the state, the Atlantic Club declared Chapter 11 bankruptcy, and next thing you know, the once-much-sought-after land casino was going up for sale.
Going Once, Going Twice
If you’re interested in buying a casino with a lot of history (this one was originally developed and built by legendary mogul Steve Wynn), now’s your chance. Bids must be received by November 18, and the auction itself will take place on an as-yet-undetermined date in mid-December. A federal bankruptcy judge gave her blessings to the hotel-casino to remain operating normally for now, under the umbrella of its Chapter 11 status.
After making its court filing last week, the Atlantic Club’s attorney Michael Sirota noted that “we do plan to move fairly quickly,” saying the casino is too short on operating budget to stay afloat for very long without a speedy sale bail out.
“It’s the beginning of a necessary process,” said Atlantic Club CEO Michael Frawley. Judge Gloria Burns put her green stamp on the sale plan, with everyone’s goal being to move it right along. She also gave a thumbs up to the casino’s continued payouts to employees, some vendors, taxes and insurance, and even the continuation of player loyalty programs, while the property sorts out its future.
Plenty of Interest Reported
Before all this happened, it was rumored that original builder Steve Wynn might be eyeing the property for purchase again; perhaps now he will move in and buy back his creation for pennies on the dollar. But if he is still interested, Wynn might have some competition; Atlantic Club co-chief operating officer Eric Matejevich noted in an interview last week that several unnamed potential purchasers have stepped forward already.
And while PokerStars may have gotten a slap in the face last week with their online gaming licensing denial by the New Jersey Division of Gaming Enforcement, they can still get a little snicker in; most experts think the ultimate purchase price for the Atlantic Club will be well below the $15 million the poker site had been willing to shell out before that deal went south back in July of this year.
Atlantic Club now becomes the second AC property to file for Chapter 11 bankruptcy protection in 2013; competitor Revel filed back in May. And a good six of the city’s 12 land casinos have made the same motion during the past six years, yet another sign of the gasping-for-air aura that seems to plague the East Coast gambling mecca.
New Jersey has high hopes for the advent of online gambling in the Garden State; annual revenues of approximately $261 million for year one are the consensus average anticipated by some industry analysts, with the state’s projections passing the billion-dollar range by year five. But as an as-yet-untried venture, it’s really anybody’s guess. Nevada’s online poker kick off has been weak by most standards, with just two sites up and running so far, but it’s expected that New Jersey’s 9 million in population (versus Nevada’s under 3 million), combined with weekend Internet players who may drive or fly in just to play online, will bring in many more gamblers. New Jersey is also offering a full range of Internet casino games, not just poker.