Atlantic City went all-in on the Revel Casino, but the gamble has failed to pay off, company officials said Tuesday.
The casino, which cost a whopping $2.6 billion to develop, became both New Jersey's second-tallest building and one that never turned a profit. Revel will close on Sept. 10, two years after it opened its doors.
The failure cuts the casino's lifeline—it had a slim chance of selling at a bankruptcy court auction—and also means the loss of more than 3,100 jobs. Revel's board had met on Monday to review the less-than-desirable bids for the casino, but chose instead to close its doors.
Atlantic City had high hopes for Revel when it opened in 2012. It wasn't just a sleek new building—as the first casino to open in the resort town since the Borgata opened in 2003, it had been heralded as the hotel that would bring waves of people back to the city. But because the original owners decided to abandon casino culture—they saw Revel becoming more a luxury resort than solely a casino—high rollers avoided the resort, leaving Revel to file for bankruptcy in 2013. Even after new owners began a "Gamblers Wanted" promotional campaign that touted a "You Can't Lose" ideology (see below), few picked up chips, forcing a second bankruptcy filing that listed liabilities of up to $1 billion.
Revel's closing, therefore, does little to revive the sputtering gambling market of Atlantic City. The city's casino revenue has plummeted since Pennsylvania opened its first casino in 2006, from $5.2 billion to just $2.86 billion last year. With Revel's shuttering, a total of four Atlantic City casinos will shut down in 2014 alone.
Lawmakers representing two of those set to close, Atlantic City mainstays the Showboat and Trump Plaza, had asked the state's Casino Control Commission last month to keep both properties open past their expected closing dates, but according to commission Chairman Matthew Levinson, the commission "simply does not have the authority to direct a casino licensee to forestall a business decision to cease its gaming operations."
In other words, the Commission cannot deal with the shutdown of operations at both casinos, and cannot help casinos give their employees more advance notice than required by state and federal law.
Unless a last-minute buyer steps forward, the Showboat will shut down Aug. 31, and Trump Plaza will shut down Sept. 16.