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Wed Feb 20, 2013, 05:49 AM

The Most Ambitious Casino In Atlantic City Is Prepping For Bankruptcy

http://www.businessinsider.com/njs-revel-casino-to-file-for-bankruptcy-2013-2




ATLANTIC CITY, N.J. (AP) Revel, the casino many people had hoped would turn around Atlantic City's sagging fortunes, said Tuesday that it will file for Chapter 11 bankruptcy protection in March, less than a year after opening.

The voluntary, pre-packaged bankruptcy envisioned for late March will wipe away about two-thirds of its $1.5 billion in debt by converting more than $1 billion of it into equity for lenders.

Kevin DeSanctis, Revel's CEO, said the restructuring will give the casino resort more flexibility to operate.

"Today's announcement is a positive step for Revel," DeSanctis said. "The agreement we have reached with our lenders will ensure that the hundreds of thousands of guests who visit Revel every year will continue to enjoy a signature Revel experience in our world-class facility."


Read more: http://www.businessinsider.com/njs-revel-casino-to-file-for-bankruptcy-2013-2#ixzz2LR3AnRUf

15 replies, 1493 views

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Response to xchrom (Original post)

Wed Feb 20, 2013, 07:43 AM

1. Why go there?

 

They are the last casino you reach after you leave the Parkway. All of the casinos have parking fees and some of these are supposed to be used to beautify the city. (The beautification looks like it is the work of an '80's graffiti artist. In other words, the city is still a shit hole.) Anyways, some of the casinos used to eat the charge. Ravel doesn't. They should.

High priced tables ... $15 minimum was the bid at tables when they first opened. I don't know what it is now. Other casinos had $10.00 and sometimes $5.00 minimums.

Restaurants. High priced hamburgers and spaghetti. There is a good clam bar. Nothing that's inexpensive.


Non-smoking... that's the good thing about the place. You don't have some asshole sitting next to you blowing smoke in your face.

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Response to jerseyjack (Reply #1)

Wed Feb 20, 2013, 08:37 AM

4. Revel

Here's why I will never go to Revel. I am not a frequent visitor to Atlantic City, but go there about 2-3 times a year. No one is going to make money based on my business, but I wonder about this place. Their original, pre-opening, ad campaign informed me that I just might not be good enough to come to Revel. My response was, Yeah, you're right, I'm not, I'll just stick with all these other casinos that seem to want my business. I thought it was kind of a dumb campaign, but what do I know, I'm just a social worker. Then, not too long after the opening, I heard they were in trouble. Flashback to the ad campaign where they told everybody in three states that Revel was too good for them. Hummm...

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Response to xchrom (Original post)

Wed Feb 20, 2013, 08:14 AM

2. An AC casino license used to be akin to a permit to print money

It was either AC or Las Vegas if you wanted to gamble in a casino. Now more and more states have casinos, so people don't have to go to AC.

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Response to xchrom (Original post)

Wed Feb 20, 2013, 08:32 AM

3. Jersey'd. n/t

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Response to xchrom (Original post)

Wed Feb 20, 2013, 11:34 AM

5. How can a casino go bankrupt? The odds are always stacked in their favor.

 

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Response to Gorp (Reply #5)

Wed Feb 20, 2013, 11:42 AM

7. By stacking too much of the odds in their own favor they have driven many gamblers away.

Sooner or later, even sick gamblers want to win sometime. The greedy corporations in the US and around the world are doing the same thing with their economies...stacking the deck too much against working men and women and those nations, including ours, is facing bankruptcy...bankrupt in spirit as well as wealth. And I don't mean the "religious spirit." I mean the spirit that keeps people working together, helping one another, being kind, being humane. The curse of Rome is upon all our houses.

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Response to Gorp (Reply #5)

Wed Feb 20, 2013, 11:44 AM

8. It is in Atlantic City, NJ.

Meanwhile, Pennsylvania and New York have added slots and board games to their racetracks, which siphons off the "bus tour" gamblers from NYC and Philly.

The Revel was an attempt to provide a "destination resort" experience, like Las Vegas, but AC is no destination.

Further, the NJ govt, and Christie especially, have precluded NJ racetracks from becoming racinos because that would drive the last nail in ACs coffin. Christie's support for AC gambling probably has lots to do with South Jersey Democrats going along with many of his programs.

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Response to FarCenter (Reply #8)

Wed Feb 20, 2013, 11:49 AM

9. That's just weird. All table games are statistically in the house's favor.

 

Slots are a completely different issue. Well, and race tracks are too. Even with just table games the house should always make a solid profit. Something smells fishy here.

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Response to Gorp (Reply #9)

Wed Feb 20, 2013, 11:58 AM

10. It needs to take in about $30 million / month to break even.

So you need a handle in the vicinity of $500 million / month?

But they took in $17.5 million last July in their best month. Last month they took in $8 million.

By converting debt to equity they can bring down their interest expense, but I'm not sure whether they can break even on a cash operating cost basis. They are running a hugely expensive property.

See http://www.businessinsider.com/revel-atlantic-city-2013-2?op=1 for pictures.

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Response to FarCenter (Reply #10)

Wed Feb 20, 2013, 12:06 PM

11. Isn't $30 million/mo a little low? I thought casinos dealt in much larger figures.

 

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Response to Gorp (Reply #11)

Wed Feb 20, 2013, 12:18 PM

12. Per the article I linked to, the Borgata took in $54 million while the Revel took in $17.5 million

This isn't the handle. This is the revenue to the casino after things like taxes are taken out of the house's winnings.

See http://gaming.unlv.edu/reports/ac_hist.pdf

Total AC casino win was $3,318 million in 2011, down from $5,218 in 2006. So this would be an average of $434 / month for all casinos in AC. There are 12 casinos, so average monthly win per casino would be $36 million.

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Response to FarCenter (Reply #12)

Wed Feb 20, 2013, 12:21 PM

13. Sounds like there's some other skimming going on.

 

The only casino I know of that went broke was a Trump joint. That's not really a shock because he's a damn idiot, but without corruption or profound stupidity, a casino should always be profitable. They're designed to be predatory and feed off of impulse. Something is seriously wrong in this scenario.

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Response to Gorp (Reply #13)

Wed Feb 20, 2013, 12:27 PM

15. They don't allow smoking? The don't encourage bus tours?

They have twice as big a physical plant to operate with subpar revenues?

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Response to xchrom (Original post)

Wed Feb 20, 2013, 11:37 AM

6. Another Trump casino?



Just kidding "The Donald" I don't need you suing me for 25 million.

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Response to rustydog (Reply #6)

Wed Feb 20, 2013, 12:22 PM

14. Don't worry. You didn't mention his road kill comb-over.

 

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