Portrait of a casino: Back in the black after 40 years
ATLANTIC CITY, N.J. » When Resorts became the first casino in the United States to open outside Nevada, gamblers overwhelmed it. Cars streamed into Atlantic City on May 26, 1978, and throngs waited in line for blocks on the famous Boardwalk.
People bought tickets for buffets they had no intention of eating, just to sneak inside the casino earlier than the rest. Men relieved themselves into plastic coin cups to avoid losing their spot at the tables. And cash — more than anyone had ever seen and more than management could imagine — flooded into the counting room, taking an entire day to count.
Forty years later , Resorts is a microcosm of the forces that boosted and buffeted the seaside gambling resort: the rapid rise to fabulous riches, the slowdown and struggle as more competitors emerged, and the recovery in a slimmeddown market.
“We were the first one here, and we’re going to keep doing what we do best,” said Resorts president Mark Giannantonio.
The casino plans to recreate the ceremonial first toss of the dice that came after then-Gov. Brendan Byrne confessed that his father taught him never to bet on anything other than Notre Dame and the New York Yankees.
But as Atlantic City grew, Resorts’ market share shrank. As one of the smaller casinos in town, with 942 hotel rooms, it suddenly found itself staring down newcomers with rooms of 2,000 or more.
And when casinos started proliferating in nearby Pennsylvania and New York, Resorts came within hours of handing the keys over to lenders and walking away in Dec. 2009.
Veteran casino executive Dennis Gomes, known for wacky promotions including customers competing against a chicken at tic-tactoe, bought the casino but died soon afterward. His investment partner, Morris Bailey, kept Resorts afloat by writing checks each month, even as the casino lost money.
A turning point came when Resorts inked a deal to have the Mohegan tribe assume day-to-day management and to affiliate it with other tribal-owned casinos in Connecticut and Pennsylvania. A deal with Jimmy Buffett brought the Margaritaville brand to Resorts, and by 2014, it was back in the black, helped by $110 million of capital investments.
It has succeeded as one of seven casinos in a market that just four years ago had 12. But two of the shuttered casinos are reopening this year.
Some see the opening of the Hard Rock casino next door, in what used to be the Trump Taj Mahal, as a potential boon to Resorts.
“If the place next to Resorts is a home run, there will be overflow,” said analyst Lawrence Klatzkin with Rice, Voelker LLC in New York. “Hard Rock could be the best thing that happens to Resorts. There could be good symbiosis there.”