The New Jersey gaming industry got rocked yet again with the announcement that Trump Plaza Hotel and Casino is planning to close in September.
It’s becoming more difficult to count the number of New Jersey casinos closing than it is counting revenue dollars that the land-based gaming operations are taking in. To recap, 2014 started with a dozen casinos on the Atlantic City boardwalk, but that number is dwindling with greater speed than an Aroldis Chapman fastball.
The Atlantic Club closed in January, Caesars is set to close the Showboat Casino on Aug. 31, Trump Plaza will cease operations on Sept. 16, and the Revel Casino will likely also lock its doors unless a buyer with deep pockets emerges. In the span of a few months, Atlantic City may lose 1/3 of its casinos, creating a blight on the Eastern Seaboard rivaling that of the devastation felt by Hurricane Sandy.
It’s a disaster,” state Sen. Jim Whelan told the Press of Atlantic City. “This is going to impact all sectors of the economy, from big stores to real estate values and on and on.”
All told, the four casinos employ roughly 7,800 workers. Two months ago, Atlantic City unemployment rates were just shy of 15%. With the addition of more casino closures, that number will swell significantly.
While the reasons for the closures are likely numerous, the increased number of casinos along the East Coast is typically seen as the main problem. Neighboring states such as Pennsylvania, which now boasts 12 casinos, have created too many options for gamblers in the region. The result is less gamblers visiting Atlantic City, creating a dilemma that may require some restructuring of New Jersey’s gaming industry.
That restructuring may come in the form of casino expansion outside of Atlantic City in the northern end of the state in an effort to win back some gamblers currently making wagers in other states. State officials have already listened to a pitch from a venture capitalist that would put a 95-story hotel casino in Jersey City, nj.com reported.
That project, said to be worth $5 billion and 25,000 new jobs, includes a proposal to erect the tallest Ferris Wheel in the world, a sports stadium, and residential housing in addition to casino and hotel operations. Such an undertaking would require the approval of voters, who may storm the voting booths in an effort to cast “aye” votes considering the number of jobs being axed in Atlantic City.
Gov. Chris Christie previously vowed to revitalize Atlantic City and has put the idea of casinos elsewhere in the state on hold until 2016. However, losing four casinos in the span of nine months or so may force the governor to play his cards differently. With a handful of casinos landing in the muck, it may be time for a new deck.
Atlantic City was a robust gambling and tourist destination prior to 2006, long enjoying the rank of second place in U.S. gaming revenue behind Nevada. But nearby states also wanted a piece of the action and got it, resulting in New Jersey losing both its runner-up status and billions of dollars in revenue.
An attempt to recoup some of those losses by legalizing online gambling has helped to some degree, although initial revenue projections have fallen short of the mark in the eight months that New Jersey’s igaming regime has been in place. Something else must clearly be done to right the ship. Casino expansion beyond Atlantic City may be a solution and will likely be looked at with greater intensity by Garden State officials following news of the Trump Plaza closure.