Will Tough Times Yield Good Deals?

Gaming resort tries to look beyond the recession.

The casino hotels of the Atlantic City skyline.
Photo courtesy of the Atlantic City Convention & Visitors Authority.

These are not the best of times for Atlantic City, but that could prove good news for summertime visitors.

Since 2003, New Jersey’s gaming resort has been swept up in a development spree that brought a steady stream of new attractions to the Boardwalk. But, like other communities around the state, Atlantic City has been hard-hit by the recession. Development has all but stopped.

In March, gaming revenue at Atlantic City’s eleven casinos was down 19.4 percent from the year before. The Tropicana is bankrupt and for sale. Resorts stopped paying its mortgage in November and is now on the brink of foreclosure. Pinnacle, a casino hotel that was to be built on the site of the former Sands, was put on hold in February. Construction of Revel, a new casino campus going up next to the Showboat, has slowed. (Construction is to be completed on its exterior but, for now, interior work has ebbed.)

Donald Trump quit the board of directors of Trump Entertainment Resorts, which is the umbrella group for the three casinos that bear his name, right before the three declared bankruptcy. And noted restaurateur Stephen Starr reportedly has sued the developers of the Pier Shops at Caesars, alleging that he was duped into opening two restaurants there.

Still, Atlantic City is getting ready to welcome summer guests. The financially troubled casinos are expected to continue with business as usual. “Nobody’s going to close a casino down if it can be avoided,” says Jeffrey Vasser, president of the Atlantic City Convention and Visitors Authority. “Something open has a lot more value in a sale than something closed.”

As far as summertime bargains are concerned, that’s as hard to predict as the spin of the roulette wheel. It appears some hotels will be offering good deals on midweek stays in hopes of attracting visitors for extended summer visits. But weekend rooms at the casino hotels will continue to be priced at a premium.

“When it comes to the Boardwalk hotels, weekends I’m still seeing in the $200-to-$300 range per night,” says travel agent Julie Sturgeon, owner of Curing Cold Feet, an affiliate of Montrose Travel. Most of the summer deals Sturgeon is seeing are packages that include airfare—something that’s not a consideration for Jersey residents.

Atlantic City’s restaurants, which enjoyed strong business during a recent restaurant-week promotion, are following up with summer meal deals. The Palm Restaurant in the Quarter at the Tropicana will be
running a summer lobster promotion beginning June 1, but the details are still being hammered out.

Capriccio at Resorts is extending its $33.09 pre-fixe restaurant week menu for the summer. The Knife & Fork Inn will offer a $17 pre-fixe lunch on summer Fridays. Offers from other restaurants are sure to follow.
Anyone who has not visited in recent years is in for surprises. Atlantic City has been putting on a new face since the arrival of the Borgata, the sleek casino hotel that opened in 2003. The Borgata raised the bar for all casinos, luring gamers and non-gamers alike with luxury accommodations, upscale dining, and spa-like pampering. The challenge became pursuing more upper-demographic visitors, rather than relying on elderly slots-playing day-trippers.

The Borgata was the first new casino hotel to be built in Atlantic City in thirteen years. It has been followed by new towers at Harrah’s, Resorts, and the Trump Taj Mahal, and major upgrades to rooms at Caesars. The Tropicana added the Quarter, a pavilion of dining, nightlife, and shopping. Caesars added the Pier Shops, which brought names like Tiffany’s and Louis Vuitton to Atlantic City. Abandoned buildings were razed in favor of outlet shopping. The Chelsea, a non-casino luxury boutique hotel, opened last year, betting that you don’t need gambling to attract people to Atlantic City.

“Other than the Borgata, the Atlantic City scene was fairly stale and hadn’t really re-addressed the needs of who today’s gamer could be versus what it was in the past, which was a senior citizen who travels by bus,” says Harvey Perkins, senior vice president of Spectrum Gaming Group, a gaming research and consulting firm in Linwood. “That’s no longer Atlantic City’s future.”

The future is the cash customer—a visitor who will pay for a room at the Borgata, dinner at Chelsea Prime (in the Chelsea Hotel), and a night out at Casbah in the Trump Taj Mahal, followed the next morning by the Waterfront Buffet at Harrah’s—without a comp for anything. (Traditionally, AC visitors could expect a complimentary room and buffet pass just for gambling in a casino. Last year, with revenues falling, the casinos began cutting back on such freebies.)

Another step into the future was taken this year with the advent of the Atlantic City Express Service, a new luxury train from New York to AC with a single stop in Newark. Subsidized by the casinos, the ACES train costs between $39 and $64 each way. The casinos hope to bring in New Yorkers and others from the surrounding suburbs—especially young professionals who have no interest in riding on buses.

“My last bus trip to AC was a five-hour ride with the air conditioning going out on the bus and having to switch buses in the parking lot of a Shop Rite,” says Tim Sullivan, 30, vice president of a New York City-based real estate investment company. He lives in Manhattan and has been using the ACES train for his monthly trip to Atlantic City since it started rolling in February.

“Ninety percent of my friends are like me,” he adds. “They don’t own vehicles and they refused to take the bus because of the reputation that precedes it.”

Atlantic City’s proximity to several major cities is a boon—especially in tough times. Las Vegas, largely a fly-in destination, has taken a worse hit during the recession. Meanwhile, Spirit Airlines, which has long run flights into Atlantic City International Airport, started new service from Boston on May 1. Another carrier, AirTran Airways, will debut flights into Atlantic City this summer, from Atlanta starting June 11 and Orlando starting June 12. 

The Atlantic City dining scene is another major attraction, with stellar newcomers Chelsea Prime (in the Chelsea) and Izakaya (in the Borgata) joining respected restaurants such as Stephen Starr’s Buddakan, Bobby Flay Steak (Borgata), Dune (in nearby Margate), Gertrudes (also in Margate), Girasole, the Knife & Fork Inn, Dock’s Oyster House, Sonsie (Pier Shops at Caesars), Mia (Caesars), Ombra (Borgata), the Palm (Tropicana), and Wolfgang Puck American Grille (Borgata). The area has also become an attractive golf destination: Forbes Traveler ranked Atlantic City’s golf scene as the sixth best in the country.

Despite such assets, Atlantic City is not quite there yet. Amid the casinos there are still pockets of squalor. Pacific Avenue, where most of the hotels are located, is pocked with check-cashing joints and cash-for-gold jewelers. And the handful of remaining low-rise hotels sit in stark contrast to the glitzy casino towers.
What’s more, the effects of the recession have been compounded by fresh competition. Changes in gaming laws have allowed new slot parlors to open in eastern Pennsylvania and in Yonkers, New York. Some think that’s not necessarily a negative.

“Competition is the best thing that could happen in any industry, especially one that has become stale and complacent,” says consultant Perkins. “Atlantic City is a high-frequency marketplace with the average player coming six times a year to gamble. High frequency usually leads to boredom. You can imagine if you ate in the same restaurant six or seven times a year and looked at the same menu, you’d get bored, too.”

Indeed, Atlantic City’s progress depends to a large extent on the ability to keep offering new enticements for the likes of Sullivan and his friends. Last year it was the Chelsea. This year it could be Dusk, the posh nightclub scheduled to open in July at Caesars. Each summer, observes Sullivan, “there seems to be a new amenity…something that’s been an eye- catcher.” 

Such comments give hope amid the sagging economy. “We’ve survived downturns before,” says Vasser. “This is certainly a bigger one, but we’re going to get through this.”

When you do decide to head to the beach, consult our 2009 Summer Beach Guide for beach badge prices, parking information and exit numbers (if you don’t know them by heart). Click here to view the beach guide (PDF format)

Click on the links below to read the different categories of our 100 Shore Things Guide:

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Atlantic City’s Shore Things

Asbury Park’s Shore Things

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