Over the past years, specifically between 2014 and 2016, Atlantic City experienced an economic crisis that led to the closing of five casinos. It is estimated that a total of 11,000 jobs were lost during that period. Understandably, the closing of the casinos led to a reduction in the gaming industry. However, since then Atlantic City has been working on rebuilding itself and attracting the numerous new visitors that flood the city during the summer holidays.
Recently, Atlantic City casinos have received a boost in revenue. This shows huge signs of recovery, especially after experiencing hard economic times. It is estimated that during the month of May, the casino industry saw an increase of 4.3% compared to the previous year with more than $229 million in revenue. Furthermore, the rise would have been 12% if the closed Trump Taj Mahal was removed from the statistics. In total, the Atlantic City casino industry generated revenue of $208.3 million compared to last year’s $203.3 million. In comparison, online gambling grew by 27.3% from a total revenue of $21.1 million this year compared to last years $16.5 million.
Additionally, the total revenue including brick-and-mortar casinos and online casinos increased to $1.073 billion, reflecting a 3.9% increase compared to same period last year. “You will see the market at $2.4 billion, if you look at the market on a rolling 12 month period,” said Colin Manfield, director of U.S. corporates at Fitch Ratings.
Economic Boost from online casinos
It is evident that the online casino is the leading gambling platform and preferred by a majority of people from all over the globe, and Atlantic City is no exception. According to the New Jersey Division of Gaming Enforcement, revenue is up over 27% for the month of May with $21 million. However, the same cannot be said for the land-based casinos, as they have experienced some of the hardest times that ultimately led to the closing of five casinos.
Online casinos dominated the gaming industry by generating a total of $19 million. The figure represents a 0.5% increase over April and a 2.7% decline, compared to last May where online casino revenue was up 35.6%. However, in March 2017 the online casino recorded an impressive 49.4% revenue. It however didn’t take up quite as much market share as it did in April where it generated 90.5% revenue. In May the figure went down 0.1% to 89.9%.
Online casinos are seen as the future of the gambling industry, and casino plays often prefer online instead of brick-and-mortar. The reasoning is usually attributed to the accessibility – you can play anywhere in the world – and the ease of account management, with payments and withdrawals made with the click of a button.
Borgata Casino is leading the gaming industry
The recent celebration in the 4.3% increase in revenue was brought about by the Borgata Casino. It is estimated that the casino generated revenue totaling to an impressive $71.8 million, a year-on-year increase of 10%. The 161,000 square foot casino offers a variety of games including 4,000 slots, 180 table games and also 50 poker tables.
Tropicana Casino also contributed largely to the boost by generating a total of $32.8 million, a year-on-year increase of 21.5%. The Tropicana structure includes three floors of gaming experience with table games, slots, poker rooms, and an Asian gaming pit. The casino also features 3,000 slots (video poker and progressive machines) and 135 tables (blackjack, craps, and roulette). Harrah’s casino took the third position with $29.5 million, up 0.2%.
Although Caesars casino comes in fourth, it has the largest increase of 23.6% compared to the other casinos. The casino generated total revenue of $29.4 million. The casino has a total number of 3,000 slots and 135 table games.
Additionally, the Golden Nugget generated revenue of 24.5 million, year-on-year increase of 17%. Finally resorts casino was the least by producing revenue of $15.3 million, with a year-on-year increase of 9.8%.
The tables were turned when it came to online gaming. Golden Nugget took first place generating $5.9 million, Tropicana and Resorts casino generated 4 million each, while Caesar collected total revenue of $3.6 million and finally Borgata casino with $3.5 million online revenue.
Capitalizing on Positive Trends
Summer time is viewed as the busiest and most profitable time of the year, since Atlantic City is often flooded with tourists. The visitors are mostly brought in by the Atlantic City Fun Xpo, which takes place each weekend throughout the summer. Aside from the epic concert, visitors take the opportunity to explore the city and actively seek out other forms of entertainment. Casino owners take advantage of the concert to promote casinos. Additionally, it is an added advantage if the casino provides hotel services. Some of the notable events include: Insane Inflatable 5k race (July 8), Pink’s concert on the beach (July 12), Atlantic City Wine Hop Tour (now through July 31), Atlantic City Seafood Festival (September 9) and the Garden State Country Music & Food Truck Festival (September 30 – October 1).
According to Matthew Levinson, chairman of the New Jersey Casino Control Commission, the increase in revenue is a great start for summer. “I anticipate great returns from casino revenue, especially with all the events planned around the city this summer,” stated Levinson. In another statement given by David Rebuck of the Gaming Enforcement Division, the solid performance and busy summer makes the Atlantic City casino industry well positioned to earn from the positive trends.
In conclusion, a year from now Atlantic City is expected to open its doors to new projects that will boost the economy even further. The two projects include Stockton University’s Gateway Project and Hard Rock’s new casino. They will be opened at the former site of the closed Trump Taj Mahal in 2018. The $500 million Hard Rock Casino is expected to generate more than 3,000 jobs.