New Casinos May Be Bad Luck For Atlantic City

Mercer 4874

Donald Kravitz/Getty Images

Resorts Casino, pictured in January, is a struggling casino in Atlantic City. As new casinos open in neighboring states, the competition for gamblers is heating up.

For most of the 20th century, if you wanted to gamble in a casino, you had to go to Nevada. Then Atlantic City casinos opened in the 1970s. Now, it seems like every state wants to legalize gambling, and lure gamblers from neighboring states. But casinos are fighting for that limited pool of customers.

Gamblers in Pennsylvania are now able to play blackjack, craps and poker without crossing the state line.

Casinos up and down the East Coast are adding table games, and industry experts say the growing competition is another bad break for Atlantic City.

For most of the 20th century, if you wanted to gamble in a casino, you had to go to Nevada. Then Atlantic City casinos opened in the 1970s. Now, it seems like every state wants to get into the game -- even Delaware. A new poker room opened last month at Delaware Park in Wilmington.

"I played a lot of places, all around the country: Vegas, Atlantic City, St. Louis. But this works," says gambler Vince Caesar.

From the day it opened, it was packed with players like Caesar and Joe Fallows, who no longer have to drive an hour or two to New Jersey to find a game.

"Atlantic City's going to feel it. They're going to definitely feel it. There's so many regulars I see in here right now," Fallows says. "And on a Friday, Saturday, they don't have enough tables."

A Limited Pool Of Customers

Delaware Park hasn't been shy about luring players from neighboring states. In fact, it's been touting its new table games with a flurry of ads and billboards.

Andrew Gentile, Delaware Park's general manager, says while poker isn't as profitable as slots, he hopes table games will bring in new business.

"It's an extremely competitive marketplace right now. And everybody's got to get out there just to protect their own share," he says. "Slots players typically are female, 45 and older. The poker player is predominantly male, and a lot of retirees. You're also seeing a lot of that younger generation that grew up in the last 10 years watching the World Series of Poker on ESPN."

But soon, those younger players will have even more choices. Casinos in Pennsylvania will start offering table games this month. Massachusetts is expected to legalize them, too.

Creighton University economist Ernie Goss says the motivation for state governments is pretty obvious.

"It's a way of getting tax revenues at a very fast clip," he says. "So there's a real, real incentive on the side of the state, on the side of the city to approve casinos."

But as states continue to legalize gambling, Goss says casinos find themselves fighting for a limited pool of customers.

"To some degree, you're going to cannibalize casinos in other states," he says. "The industry is going to get much more competitive, particularly in the northeast portion of the U.S."

Atlantic City's Lone Bright Spot: The Borgata

For New Jersey, the timing couldn't be worse. The recession -- coupled with increased slots competition from Pennsylvania -- has already pushed revenues at all Atlantic City casinos down for two years in a row.

"People are spending less. So while they may be coming to Atlantic City -- and we know that they are coming because our room nights are up -- they're being more careful about how they spend their money," says Linda Kassekert, who heads the New Jersey Casino Control Commission.

Pretty much the lone bright spot for Atlantic City has been the Borgata. In a town with a bit of a reputation for seediness, the Borgata offers high-end shopping and restaurants. That's why senior vice president Joe Lupo says he's not so worried about new competition from other states.

"It's the fine dining we have at Borgata, it's the entertainment program, the spa -- it's those other amenities that I think turned Las Vegas into the gambling mecca," he says. "I think you're slowly seeing non-gaming revenue slowly increase here in Atlantic City."

For Atlantic City to compete with more convenient options, other casinos in town will likely have to follow the upscale Las Vegas model. But the recession has made that tougher, too. A few years ago, investors were ready to bet $10 billion on casino projects.

Now those construction cranes stand idle, while Atlantic City waits for its luck to turn.

Copyright 2010 National Public Radio. To see more, visit http://www.npr.org/.

More in U.S. / World

Comments

blog comments powered by Disqus