For sale: One casino, slightly used

Having walked into a PR buzzsaw with its announced closure of the Showboat, in Atlantic City, owner Caesars Entertainment is trying to salve the wound. “We’re willing to sell if we receive a reasonable offer from a responsible buyer,” said company spokesman Gary Thompson. Of course, the X factors are who Caesars considers “responsible” and what price it deems “reasonable.” As it knows from its sales of the Claridge Hotel and Atlantic Club Hotel, you can’t get much more than pocket change for an Atlantic City casino these days. Nobody’s likely to come in and offer $50 million for the Showboat, so Caesars should probably trim its expectations accordingly.

Thompson added, “We’ve received some expressions of interest from a number of groups [on the heels of the closure notice] and are reviewing them.” Well, that’s good. One of them very well could be Hard Rock International, which can’t get what it deems an affordable price on Revel Casino Hotel but might deem Showboat more within what it’s willing to pay. With closure looming on Aug. 31, Caesars will be under pressure to get a deal done, chop chop.

Meanwhile, Unite-HERE continues to hold protest rallies. Union boss Robert McDevitt praised Caesars for its change of mind, adding the caveat that Caesars should have been trying to sell the Showboat in the first place. There’s a bit of a crimp in all the good news, seeing as Caesars has made a sale contingent on the buyer being one who “could be licensed” in New Jersey. That makes getting a deal and a license a real rush job for anyone not presently in the market (none of whom are likely to nibble at this hook). Let’s hope Caesars doesn’t attach any further conditions to the sale.

Assemblyman Chris A. Brown (R, below) put the entire matter into perspective: “When a corporation like Caesars closes a profitable casino in Atlantic City while they choose to build a new $880 million casino in New York, it hurts our middle class, working men and women, mars the image of Atlantic City, and breaks its promise to the state … This is unacceptable, and it’s time to stand up for the working middle class.”

Brown has proposed a series of trust-busting legislative actions, one of which would limit the number of licenses held by one company in any market to two. Another would bar companies from selling casino properties with anti-gaming deed restrictions attached, much as Caesars did with the Atlantic Club and Claridge. Congressman Frank LoBiondo (R) has added his wrath to that of McDevitt and Brown. Caesars’ biggest gaffe in this whole affair was to axe the Showboat when it was showing an operating profit, giving critics a driver with which to tee off on Gary Loveman‘s head.

Elsewhere in New Jersey, state Senate President Stephen Sweeney (D) continues to insist that building a casino in the northern part of the Garden State and taxing it to the rafters is the solution to Atlantic City’s problems, “to repurpose casinos, to improve infrastructure, to make Atlantic City what we know it can be.” State Sen. James Whelan (D) says it’s a question of “throwing some slot machines into the Meadowlands” versus building “the most fabulous casino in the history of mankind.” If Whelan wants the latter, he’d better have Sheldon Adelson or Steve Wynn on speed dial, although I can’t imagine either of them wanting to be used as a prop for the Boardwalk.

Then there’s billionaire and former Reebok CEO Paul Fireman. He’s pitching a 95-story casino/hotel/condo megaresort for downtown Jersey City: “The $4.6 billion project would also feature residences, a 107,500-seat motor sports stadium and what is billed as the largest Ferris wheel in the world.” The budget alone — almost double that of Revel — puts an onus on Fireman to deliver customers. 

Whelan was grudgingly supportive but colleague Raymond Lesniak (D) drank deeply of Fireman’s bathwater: “It will blow away Macao as a destination place for gaming …. this would attract the high rollers from around the world.” Oh ho, too funny.

Assemblyman Ralph Caputo (D) was elaborately noncommittal, saying, “When companies or investors lay out a… plan like that — an expensive, massive project — it very possibly can work.” And it possibly can’t, as we saw with Revel. At least it would be in close proximity to the state’s light-rail system, delivering customers to its doorstep. Lesniak wants to see two northern Jersey casinos — the Fireman project and something at the Meadowlands for day trippers. I don’t know if Lesniak got the memo but, at $4.6 billion, Fireman’s going to need every gambler he can get.