Atlantic City Open Forum
Quote: dave12038457Another post I agree with. I believe unless the state wrests control of A.C. away from the local politicians, it is destined to fail. Local politicians seem to win elections based on how many hand outs they can promise the locals. Remember the CRDA has sunk $35,000 for every man woman and child who calls A.C. home into the city. They built over 1,000 new housing units for residents, much of it is unsafe low income housing. Rather then remove the ghetto they simply moved it. In N.J. few properties are more desirable then shore towns. Yet in A.C. one can easily find a home or condo not far from the beach that is far from expensive. I have seen condos selling for 40k.
That's the other problem with AC.
It's not just the fact the city's a dump, but the ghetto trash people who live there are another issue. And the problem is it's very hard to get rid of trash people
And with all the new unemployment, the situation is going to get worse, not better.
Quote: onenickelmiracleAtlantic Club, Plaza, Showboat, Taj. How will the new Revel cannibalize their abandoned customers? Atlantis has national advertising, so they'll probably bring in fresh meat to the city more than they'll take. They're going to have a chance I think.
Where is this "fresh meat" going to come from? Until more airlines decide to add AC flights, it is still cheaper to go to Vegas than it is to AC from many East Coast markets and I am not sure they are going to get non gamblers to come there like they do at Atlantis. The casino is a very small part of Atlantis and you don't even see much of it in the ads for it. They advertise it as a family destination, which AC is not. Unless they do the things Babs is talking about, I see nothing they can do to improve the current AC experience, nor do I see them doing any better than Revel did without taking current AC customers from other casinos.
Quote: bobsimsThe ship has sailed. Put in Meadowlands casinos (plural) and let AC settle down as a south Jersey/Philly area locals destination where people can spend a day or 2 at the shore. Room for 4 casinos, maybe 5. Vegas has like 30 locals casinos with about the same population base as south Jersey/Philly.
I have been saying for years that AC needs more of a Vegas type feel if they want to make it work. Great shows, buffets, and all of the other amenities. AC always said, Hey look at us we have an ocean. I still feel that it can be changed and become a resort town again but no one is going to want to take the risk.
When one can walk at night from one end of the city to the other and feel at ease, then improvements and other family oriented attractions will succeed.
Quote: sc15That's the other problem with AC.
It's not just the fact the city's a dump, but the ghetto trash people who live there are another issue. And the problem is it's very hard to get rid of trash people
And with all the new unemployment, the situation is going to get worse, not better.
... on top of all that, we'll have all those 21 yr old white geniuses who flocked to AC in anticipation of Straub winning, hassling us for book money on the boardwalk
Have your party pit with nude, or G-string dealers (male and female) (that would be unique).
Offer 8:5 BJ. If that creates too low of a HE, take something away that most people don't understand like surrender.
Offer a kid care service (with a hook to make sure the people are gambling).
Tie your gambling activity to some exclusive activity on the beach, so that others on the beach decide they want to gamble at your house so they can take part too.
Create unique perks at your casino. Give away something other casinos can't, or won't, give away.
And of course my pet peeve, get rid of any service personnel who exhibits any attitude towards customers. My employee motto would be "Be polite, or be gone."
But it will never happen, because the AC attitude is, "It's shearing time. Come play in our AC casinos, you stupid sheep."
Quote: beachbumbabs
This goes to the larger question of AC itself. AC's halcyon days were in the 1920's, right? .
I think it was the 40's and 50's and in the
60's it started to decline and in the 70's
the casinos were supposed to bring it back.
Quote: beachbumbabsActually, you SHOULD get richer by failing. But not directly from the failure itself. By learning from the mistake.
This goes to the larger question of AC itself. AC's halcyon days were in the 1920's, right? With the boardwalk, amusement park, vendors, grand hotels, etc. Everything since then has been random wallpaper, not a complete renovation.
Time for a complete renovation. Knock it to the ground, most of it, and re-make it. One of the few places Eminent Domain makes Eminent Sense. JMHO.
What doomed the original AC - was "A/C"- (air conditioning).
The same could be said if you look at pics thru the 50's of Coney island - now people don't need the shore simply to escape sweltering summer heat
http://www.nytstore.com/assets/images/extralarge/NSAP1018_EXTR.jpg
The local government has a long history of corruption and graft. During prohibition there was no shortage of places to get a drink and gamble. The places that offered such "vices" paid a tax to the local political party to ensure a trouble free operation. The guests who wished to drink and party during prohibition were so plentiful and the business of providing vice so lucrative it helped to justify funding Boardwalk Hall.
It was chosen as the site of the first organized crime conference for good reason, the mayor Nucky Johnson was one of them.
http://en.wikipedia.org/wiki/Atlantic_City_Conference
Atlantic City had a somewhat seedy underbelly dating back at least to the early 1900's. It was in the years after wwii that the city began to deteriorate.
The end of housing discrimination ironically played no small part in the demise of A.C. in the 1950's. Prior to that time A.C. was home to many middle-class and professional Blacks. They lived together in the same neighborhoods as their poorer peers. With the end of housing discrimination many middle-class and professional Blacks left the city for the suburbs. The Blacks left behind were poorer and less educated. The predominantly Black neighborhoods deteriorated as the stabilizing forces of the middle and professional classes left. Black neighborhoods were then considered unsafe no go zones for many Whites. Many Whites then began leaving the city in the 1950's. The housing stock deteriorated, became less expensive and was more and more managed as rental properties. As a result the city demographics changed to a majority poorer and minority town. It is this legacy that still holds true for the city today with the exception of an influx of Hispanic and Asian residents. The city has lacked a good middle class for half a century.
I have often read the premise about air-conditioning leading to the down fall of Atlantic City. I would think if that was the case, other shore towns would suffer a similar fate. Instead most have grown and prospered exponentially.
Just my .02 for what it's worth.
"A federal judge on Friday refused a request to immediately end pension payments for unionized Trump Taj Mahal workers. The casino-hotel’s bankrupt parent company told the judge yesterday that the Boardwalk property will close in November if the payments continue."
Quote: 7star4nowPAC reports-Judge refuses immediate end to Taj pension payments
"A federal judge on Friday refused a request to immediately end pension payments for unionized Trump Taj Mahal workers. The casino-hotel’s bankrupt parent company told the judge yesterday that the Boardwalk property will close in November if the payments continue."
McDevitt and his cronies think this is a bluff. It's not. Tough situation to be in for the workers, but they need to start looking now because it is closing.
Quote: 7star4nowPAC reports-Judge refuses immediate end to Taj pension payments
"A federal judge on Friday refused a request to immediately end pension payments for unionized Trump Taj Mahal workers. The casino-hotel’s bankrupt parent company told the judge yesterday that the Boardwalk property will close in November if the payments continue."
I'm starting to think it's not a bluff. November is the best month to close, fold their hands, dangle the carrot of reopening and waiting for the union, bondholders and city to cave.
Icahn really hasn't agreed to anything though. Even if everyone agrees down the line, he can still say no or change terms breaking the deal. I would like to think his best interests would be served keeping Taj open, but I'm not sure it's true.Quote: bobsimsI'm starting to think it's not a bluff. November is the best month to close, fold their hands, dangle the carrot of reopening and waiting for the union, bondholders and city to cave.
Quote: onenickelmiracleIcahn really hasn't agreed to anything though. Even if everyone agrees down the line, he can still say no or change terms breaking the deal. I would like to think his best interests would be served keeping Taj open, but I'm not sure it's true.
I think Icahn has no intention of saving TAJ.
IMO, He is using this death march to hold over the head of Trop employees
Quote: 7star4nowI think Icahn has no intention of saving TAJ.
IMO, He is using this death march to hold over the head of Trop employees
You may be right...but I don't understand something. If you don't intend to operate the casino and let it go bankrupt...concessions from the employees are meaningless. So why bother playing hardball with the union if you are planning to let it go bankrupt. Doesn't make sense. I think he's trying to leverage his position to one of 100% control.
It was built under the theory that high-end casinos have a captive audience of shoppers who will use the same gambling impulse to splurge on a Gucci bag. At the time, it was appraised at $187.5 million.
Torchlight Loan Services, put the property up for sale this past June, hoping to get enough to help pay down some of the debt. In all, about $150 million of debt is weighing down the property. It has about $50 million in equity, according to sources.
By trading for what is believed to be about $2.5 million, none of the debt will get paid off but the property will be in the hands of a developer with a solid track record.
“What we’re going to do is going to be incredible,” he said. “It’s going to take the whole Atlantic City experience to another level. I think it’s going to rock.”
Blatstein declined to divulge details on what he intended to do with the property other than to say it would be a retail and entertainment destination."
http://www.bizjournals.com/philadelphia/blog/real-estate/2014/10/blatstein-to-buy-pier-shops-in-atlantic-city.html
Quote: 7star4nowBlatstein to buy Pier Shops in Atlantic City for $2.5M
It was built under the theory that high-end casinos have a captive audience of shoppers who will use the same gambling impulse to splurge on a Gucci bag. At the time, it was appraised at $187.5 million.
Torchlight Loan Services, put the property up for sale this past June, hoping to get enough to help pay down some of the debt. In all, about $150 million of debt is weighing down the property. It has about $50 million in equity, according to sources.
By trading for what is believed to be about $2.5 million, none of the debt will get paid off but the property will be in the hands of a developer with a solid track record.
“What we’re going to do is going to be incredible,” he said. “It’s going to take the whole Atlantic City experience to another level. I think it’s going to rock.”
Blatstein declined to divulge details on what he intended to do with the property other than to say it would be a retail and entertainment destination."
http://www.bizjournals.com/philadelphia/blog/real-estate/2014/10/blatstein-to-buy-pier-shops-in-atlantic-city.html
This could be good for the town. Anything is better than 3/4 of the place empty and a water show that has been broke for 6 months.
Quote: 7star4now
“What we’re going to do is going to be incredible,” he said. “It’s going to take the whole Atlantic City experience to another level. I think it’s going to rock.”
C'mon, that's funny. No it's not going rock, it's
going to lay there like a dog turd. Nobody is
going to AC anymore, why would they.
Quote: Artemis
Oh sh*t! NJ DGE has already knocked off Showboat Casino from the above monthly financial report. Revel will be next... then Taj! What a shame!
Well the September release should be out tomorrow. What do you think? Will 8 casinos rake in the same amount as 12 casinos the year before?
Quote: pacomartin
Well the September release should be out tomorrow. What do you think? Will 8 casinos rake in the same amount as 12 casinos the year before?
My thoughts are most if not all (perhaps Ballys) will be up but not enough to make up for the loss of 4. Therefore AC will be down slightly overall versus LY but the remaining casinos will still spin it as a positive sign.
Quote: BozMy thoughts are most if not all (perhaps Ballys) will be up but not enough to make up for the loss of 4. Therefore AC will be down slightly overall versus LY but the remaining casinos will still spin it as a positive sign.
Well, if you are one of the remaining 8 casinos it is a positive sign. 30 million a month is better than 25 million a month. Granted the underlying economics of the region haven't changed. But there is no question that the remaining AC casinos are better off.
Quote: vendman1Well, if you are one of the remaining 8 casinos it is a positive sign. 30 million a month is better than 25 million a month. Granted the underlying economics of the region haven't changed. But there is no question that the remaining AC casinos are better off.
I don't think that outcome is obvious. People may just stay away in droves. The press release has never been later than the 14th of the month.
Here are my predictions. I think the whole Boardwalk will go down except Tropicana. I still think the total for the city will be down from last year.
| Casino | Sep 2013 | Sep 2014 |
|---|---|---|
| Borgata | $51,757,951 | up |
| Harrah's | $29,529,835 | up |
| Caesars | $23,832,289 | down |
| Trump Taj Mahal | $22,688,693 | down |
| Tropicana | $20,253,292 | up |
| Bally's AC | $20,077,557 | down |
| Showboat | $16,147,925 | $0 |
| Revel | $14,881,769 | $0 |
| Atlantic Club | $12,334,066 | $0 |
| Resorts | $11,586,732 | down |
| Golden Nugget | $10,730,551 | up |
| Trump Plaza | $6,408,878 | $0 |
| Total Ceasars Inc | $89,587,606 | down |
| Total 8 casinos | $190,456,900 | up |
| Total AC | $240,229,538 | down |
The Taj being the exception...obviously the smell of death is lurking there. Additionally the re-opening of Revel/Whatever they call it...will have some effect on the business...as yet unknown since they have revealed no plans yet.
Quote: vendman1But in the long run AC will be better off with 8 casinos (or 7 or 9)...than with 12 casinos. As to the specifics of which casinos are up or down...I would expect them all to be up, IN THE NEXT YEAR OR SO. But maybe not right away.
The Taj being the exception...obviously the smell of death is lurking there. Additionally the re-opening of Revel/Whatever they call it...will have some effect on the business...as yet unknown since they have revealed no plans yet.
With service business you can usually predict some ratio. If you have 12 KFC chicken places and you close the 4 poorest performing ones, usually very little business goes to the remaining 8 since most people switch their brand of fast food. But when you had 12 casinos in downtown Las Vegas and Binion's went bankrupt the other casino owners get upset. They think that people will get depressed, and not come to downtown Las Vegas and gamble, and everyone will lose. In other words they compete with one another for customers, but they don't want the competition to go out of business.
When the Revel opened originally, it's revenue was so low that there was no sign that anyone had customers stolen. I am sure that Resorts will be happy as anyone to see Revel reopen. It means more people will come to that end of the boardwalk. Many will come to see the Revel, but gamble at Resorts where the stakes are lower.
This is the first time ever they didn't do the press release by the 14th. Presumably they are legally obligated to release data by the 15th of the month.
Quote: pacomartinWith service business you can usually predict some ratio. If you have 12 KFC chicken places and you close the 4 poorest performing ones, usually very little business goes to the remaining 8 since most people switch their brand of fast food. But when you had 12 casinos in downtown Las Vegas and Binion's went bankrupt the other casino owners get upset. They think that people will get depressed, and not come to downtown Las Vegas and gamble, and everyone will lose. In other words they compete with one another for customers, but they don't want the competition to go out of business.
When the Revel opened originally, it's revenue was so low that there was no sign that anyone had customers stolen. I am sure that Resorts will be happy as anyone to see Revel reopen. It means more people will come to that end of the boardwalk. Many will come to see the Revel, but gamble at Resorts where the stakes are lower.
This is the first time ever they didn't do the press release by the 14th. Presumably they are legally obligated to release data by the 15th of the month.
Well this would certainly make a good business school debate. I don't think casinos are exactly comparable to KFC franchises, but your point may very well be right. I would bet though that my overall point is still right. AC isn't just going to blow away in the wind. They just need to adjust the casino capacity to fit the market. I said in another post...they are down to about 50% of the peak for gaming in AC. From just under 6B to just under 3B. That 3B is not enough to support 12 casinos. It probably will be enough to support 7 or 8 casinos. To your point about Resorts...sure some critical mass is needed at the north end of the boardwalk. I'm sure Resorts is rooting for the Taj to stay open and for the Revel to successfully rebrand/reopen, as you are right it will help their business. There are certainly ancillary benefits from having some casinos grouped together.
What would probably doom AC is if we get down to only 3 or 4 operating casinos. At that point there might not be enough critical mass to maintain it as a gaming area.
I think both Caesar's and Bally's will see an uptick in business.
With the closing of Showboat, people invested in the Total Rewards program will want to keep their comps. Since the already like a boardwalk casino, it stands to reason many will migrate to Bally's and Caesar's and perhaps to a lesser extent Harrah's.
Trump players is anyone guess. But the Taj Mahal does generate considerable casino revenue. I am certain many offers will be made to those who were loyal to those casinos.
Quote: dave12038457Of course everything is pure speculation at this time but...
I think both Caesar's and Bally's will see an uptick in business.
I predicted wrong on Ceasars. It went up. Resorts dropped by an almost imperceptible amount.
| Casino | Sep 2013 | Sep 2014 | Change |
|---|---|---|---|
| Golden Nugget | $10,730,551 | $16,272,358 | 51.65% |
| Borgata | $51,757,951 | $58,471,400 | 12.97% |
| Harrah's | $29,529,835 | $31,278,198 | 5.92% |
| Caesars | $23,832,289 | $26,112,416 | 9.57% |
| Caesars Interactive | $2,663,968 | ||
| Bally's AC | $20,077,557 | $19,625,079 | -2.25% |
| Tropicana | $20,253,292 | $23,446,805 | 15.77% |
| Resorts | $11,586,732 | $11,581,961 | -0.04% |
| Trump Taj Mahal | $22,688,693 | $17,503,951 | -22.85% |
| Trump Plaza | $6,408,878 | $767,870 | -88.02% |
| Showboat | $16,147,925 | $0 | -100.00% |
| Revel | $14,881,769 | $0 | -100.00% |
| Atlantic Club | $12,334,066 | $0 | -100.00% |
| Total AC | $240,229,538 | $207,724,006 | -13.53% |
| Total 8 casinos | $190,456,900 | $206,956,136 | +8.66% |
| Total Boardwalk | $148,211,201 | $101,702,050 | -31.38% |
| Total Back 3 casinos | $92,018,337 | $106,021,956 | +15.22% |
| Total Ceasars Inc. | $89,587,606 | $79,679,661 | -11.06% |
Ceasars Inc seems to have captured about half the revenue it lost from Showboat, so presumably their operations will be more favorable.
It looks like Resorts will probably hold on until the Revel reopens.
The "Back 3 casino" on the back bay & marina are looking healthier than ever.
Quote: pacomartin
The "Back 3 casino" on the back bay & marina are looking healthier than ever.
Why do they do so well? When I go to AC, I go there for the boardwalk/beach plus some gaming. I would never think about staying away from the beach. If I wanted to do that then I would stay in PA with the better games.
Quote: GWAEWhy do they do so well? When I go to AC, I go there for the boardwalk/beach plus some gaming. I would never think about staying away from the beach. If I wanted to do that then I would stay in PA with the better games.
I often wondered this too. I mostly go to AC for the beach. While I've stayed at all 3 marina properties I prefer the boardwalk ones. I think this is the answer.
Borgota--It's the best casino in town. Run the best. Nicest in general. Tons of Poker action.
GN - So much better than the Trump Marina was. Their numbers have consistently gone up since they took over they are obviously doing something right.
Harrahs - With their indoor "the Pool" thing they have captured the low roller 20 something party crowd. It's actually doing the best of the 3 CET properties in town. Plus in the winter this is a fun place to go there is really enough to do that you'd wouldn't need to leave the facility if you didn't want to. This place hosts a lot of Bachelor parties and such.
One thing is certain, a marina casino has never closed while 6 boardwalk casinos have fallen to the wayside.
Many frankly don't like the characters one sees in boardwalk casinos and on the boardwalk itself. They make some feel uneasy. The other is all the boardwalk casinos border blighted areas with a crime problem. Walk 3 blocks from Bally's in the wrong direction and you will find yourself at Stanley Holmes Village.
Stanley Holmes has been a major crime epicenter in A.C. for at least 30 years.
When tourists are stabbed to death, carjacked and murdered it happens for the most part at boardwalk casinos or nearby. The marina district is somewhat isolated from the neighborhoods. Yes marina properties do have problems. Just not on the magnitude of boardwalk casinos.
Some have gone so far as to speculate that Revel if managed differently and located in the marina district could have been a success.
Quote: dave12038457People have often speculated on the obvious disparity between boardwalk vs marina casinos.
One thing is certain, a marina casino has never closed while 6 boardwalk casinos have fallen to the wayside.
Many frankly don't like the characters one sees in boardwalk casinos and on the boardwalk itself. They make some feel uneasy. The other is all the boardwalk casinos border blighted areas with a crime problem. Walk 3 blocks from Bally's in the wrong direction and you will find yourself at Stanley Holmes Village.
Stanley Holmes has been a major crime epicenter in A.C. for at least 30 years.
When tourists are stabbed to death, carjacked and murdered it happens for the most part at boardwalk casinos or nearby. The marina district is somewhat isolated from the neighborhoods. Yes marina properties do have problems. Just not on the magnitude of boardwalk casinos.
Some have gone so far as to speculate that Revel if managed differently and located in the marina district could have been a success.
while a lot of that is true I would bet 90% of travelers, especially first timers, have no idea of the crime problems in the nearby areas.
Quote: dave12038457Walk 3 blocks from Bally's in the wrong direction and you will find yourself at Stanley Holmes Village.
Pretty sure it's actually closer to Borgata than to Bally's.
Quote: dave12038457Some have gone so far as to speculate that Revel if managed differently and located in the marina district could have been a success.
One thing is that Harrah's in the marina was careful to develop table games when revenue started falling. Money was invested to make it more upscale. The first Philadelphia racinos opened in January 2007 so 2006 was the top earning year in AC.
I went to 2012 because there were fewer ownership changes.
| Property | 2006 | 2012 | Drop | status |
|---|---|---|---|---|
| Sands |Revel | $147,976 | $122,316 | closed | |
| Trump Plaza | $300,894 | $102,506 | -66% | closed |
| AC Hilton | $330,083 | $127,175 | -61% | closed |
| Bally's | $677,290 | $296,028 | -56% | |
| Resorts | $282,896 | $130,833 | -54% | |
| Trump Marina | $257,166 | $130,451 | -49% | |
| Showboat | $429,514 | $225,410 | -48% | closed |
| Tropicana | $459,150 | $249,994 | -46% | |
| Trump Taj Mahal | $529,233 | $295,492 | -44% | ? |
| Caesars | $555,243 | $358,565 | -35% | |
| Harrah's | $508,980 | $399,240 | -22% | |
| Borgata | $739,289 | $612,691 | -17% | |
| Industry | $5,217,714 | $3,050,701 | -42% |
The overall brick and mortar business was down 17.1% compared to September 2014 - YIKES!
Based on its performance through the first 8 months of 2014, Showboat, had it stayed open, should have generated about $13.3 million in casino win. Of course it was closed and generated nothing. It appears that the other Caesars casinos "picked-up: about $7.5 million based on an analysis of their YTD performance through August. So, it seems that Caesars was able to steer a little more than 50% of the Showboat business to its other AC properties. I think this in in-line with analyst expectations. However, it should be noted that Caesars' overall performance in AC in September was 14% lower than September 2013 so they are still hemorrhaging business in AC at an alarming rate.
For the five non-Caesars casinos still operating in AC in September, their combined performance was actually worse than in the first 8 months of the year. January through August, these 5 casinos had an average casino win improvement of 4.7%, in September, this improvement was only 3.0% suggesting that none of the business from the closing of Trump Plaza and Revel was transferred to other casinos. Of course, within this group, there are winners and losers. In September, Borgata and Golden Nugget were clear winners, Tropicana and Resorts really had mixed results and Taj is on life support. In general, the closer the casinos are physically to the "closed" North End casinos, the worse they performed.
I really don't see much evidence that the closing of properties in AC is stabilizing the market. It seems to me that the benefit from a reduction in inventory is more than being offset by the perception that AC is a place that is on the decline and not worth going to. It's really starting to look like a death spiral. I really doubt that additional closures will stabilize the market.
The only truly healthy operation appears to be Borgata, which is approaching a 30% market share.
Quote: GWAEWhy do they do so well? When I go to AC, I go there for the boardwalk/beach plus some gaming. I would never think about staying away from the beach. If I wanted to do that then I would stay in PA with the better games.
You are forgetting about the day trippers. They don't care about the beach or staying overnight.
When I go to AC, I go to gamble. It's usually a 6 - 7 hour trip. If you live north of AC, it's much easier to get off the GSP at exit 40 and to visit the Marina district than the boardwalk. You avoid the Expressway toll and the traffic.
I don't need a boardwalk and there are some nicer beaches in Monmouth and Ocean counties.
Quote: FatGeezusQuote: GWAEWhy do they do so well? When I go to AC, I go there for the boardwalk/beach plus some gaming. I would never think about staying away from the beach. If I wanted to do that then I would stay in PA with the better games.
You are forgetting about the day trippers. They don't care about the beach or staying overnight.
When I go to AC, I go to gamble. It's usually a 6 - 7 hour trip. If you live north of AC, it's much easier to get off the GSP at exit 40 and to visit the Marina district than the boardwalk. You avoid the Expressway toll and the traffic.
I don't need a boardwalk and there are some nicer beaches in Monmouth and Ocean counties.
I always take that exit to the White Horse Pike then straight to the Marina or down North Carolina to the Boardwalk.
Quote: mrfrancksThe only truly healthy operation appears to be Borgata, which is approaching a 30% market share.
Tropicana is in good shape. Ceasars shows great ability to be able to reduce costs and stay ahead of the decline in business. By closing Showboat, I think that they made sure they could keep doing that. Unfortunately the company has to do a lot more than just make an operational income. They are saddled with killer debt, and they have to be growing out of that, not just failing to rehire people.
"Caesars said in an Aug. 11 filing that it didn’t expect to have sufficient cash flow from operations to be able to repay its indebtedness and would have to restructure its debt...Caesars’ $4.5 billion of 10 percent, second-lien notes due December 2018 have $225 million in interest payments Dec. 15, a cash outlay other creditors don’t want leaving the company. When a company misses an interest payment, it has a 30-day grace period before it’s in default, which means the company may seek a Chapter 11 filing by Jan. 15."
http://www.bloomberg.com/news/2014-10-16/caesars-amends-pact-paving-way-for-january-bankruptcy.html?cmpid=yhoo
"So far by shuffling assets, Caesars has Harrah’s Resort out of the reach of creditors. Unfortunately, its two Boardwalk casinos, Caesars Atlantic City and Bally’s Atlantic City are included in the over burgeoning debt the company is facing...Alex Bumazhny, a Fitch Ratings casino analysts believes there’s a good chance creditors will take ownership of the Boardwalk properties, and that bankruptcy is highly likely at this point. Chad Beynon, a senior analyst at Macquarie Securities Group agreed with Bumazhny’s assessment but also shared thoughts saying,“Just because you file for bankruptcy doesn’t mean you need to shut the business down. That’s just kind of a public way of telling your debt holders that you don’t have enough money to pay them back right now and (say) let’s try to reorganize some things here.”
http://www.casinoscamreport.com/2014/10/18/caesars-entertainment-fortify-reduce-chapter-11/
Quote: vendman1Wasn't everyone in the industry expecting a CZR bankruptcy for the past several years? They've been robbing Peter to pay Paul for a while now. The financial musical chairs were bound to catch up to them eventually. A while ago they moved some properties into a holding company with the purposes of saddling that "new" company with all the debt. Which I think most observers assume they will eventually default on. That move is still being fought by some of their bondholders I believe. Caesars AC and Ballys are part of that. So I think this may stay in limbo for a while now. Still it's bad. Not to derail an AC based thread but does anyone know how many of the 9 or so properties CET owns in Vegas are lumped in the new CET Holdings or whatever it's called?
"After recent maneuvering, Caesars consists of three companies: Caesars Entertainment Operating Company, Caesars Entertainment Resort Properties, and Caesars Growth Partners, which is part-owned by Caesars Acquisition Company (NASDAQ: CACQ ) . We have to take some of the operating results piece by piece.
During the past year, Caesars has been pushing assets down to subsidiaries like Caesars Entertainment Resort Properties and Caesars Growth Partners. The former now owns the Harrah's Atlantic City, Harrah's Las Vegas, Paris, Flamingo, Rio, Octavius Tower at Caesars Palace, and Project Linq real estate assets in Las Vegas. Caesars Growth Partners owns Planet Hollywood, Caesars' online gaming assets, and recently announced the acquisition of Bally's Las Vegas, The Cromwell, The Quad, and Harrah's New Orleans for $2.2 billion.
The shift of assets leaves much of the debt with Caesars Operating Company, which would leave value with those companies if Caesars Operating Company files for bankruptcy. At least that's what management thinks, but it would likely be a huge fight for assets if bankruptcy does ensue."
https://wizardofvegas.com/forum/off-topic/other-casinos/15899-atlantic-city-open-forum/110/
