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In latest setback to Atlantic City, lavish Revel casino to close

More than 3,000 employees face loss of jobs as Revel casino in Atlantic City, N.J., announces closure
Two bankruptcies and $2.4 billion aren't enough to keep Atlantic City, N.J., Revel casino afloat
Revel Casino's finances had skeptics from the start when it opened in 2012

Atlantic City's lavish Revel casino, which opened two years ago amid hopes it could revive the city's dwindling tourism and gambling revenues, conceded failure Tuesday, announcing that it would close by Sept. 10.

The announcement was the latest setback to Atlantic City, N.J., a once-thriving seaside resort that fell on hard times and looked to casinos to fuel its resurgence. The Revel's closure will put more than 3,000 employees out of work.

"We regret the impact this decision has on our Revel employees who have worked so hard to maximize the potential of the property," Revel AC Inc. said in a statement. "We thank them for their professionalism and dedication; however we are faced with several unavoidable circumstances."

The statement went on to say that efforts to improve Revel's financial performance had "not proven to be enough to put the property on a stable financial footing."

It said efforts to find a buyer for Revel had so far failed. "Revel cannot avoid an orderly wind down of the business at this time," it said, adding that the company still hoped for a sale.

Revel is one of four boardwalk casinos closing this year due in part to neighboring states' gaming industries cutting into Atlantic City's business.

Since it opened in May 2012, Revel has filed twice for bankruptcy, most recently in June. The soaring casino, hotel, and dining and entertainment complex opened to much fanfare in the spring of 2012 and vowed to set itself apart from the boardwalk's other gambling meccas.

Natural light poured in through windows looking out over the Atlantic. Fine dining restaurants replaced the low-cost buffets that are the norm at many casinos. There were shows, spa offerings and luxuries aimed at drawing visitors not inclined to spend their time gambling. Revel was also smoke-free, unique in a city where smoking was permitted on casino floors.

Even as it opened its doors, though, Revel faced skepticism from some financial experts who said its heavy debt load could prove its undoing if business was not robust.

The Press of Atlantic City reported at the time that Standard & Poor's assigned a "negative outlook" to the casino operator's debt, and that Linda M. Kassekert, the chairwoman of the New Jersey Casino Control Commission, said the casino's financial projections appeared "extremely ambitious."

The casino cost $2.4 billion and took on additional debt after a chief financial backer pulled out of the project in 2010.

Revel never turned a profit, and like Atlantic City's other casinos, it was hurt, in part, by neighboring states' build-up of their own gaming industries.

That has eliminated gamblers' needs to make the trip to Atlantic City, whose gaming revenues last year were their lowest since 1989: $2.8 billion.

Revel was one of the city's poorest-performing casinos.

Atlantic City once had a dozen casinos on the boardwalk. The Atlantic Club closed in January. The Showboat and the Trump Plaza Hotel and Casino announced plans to close this year. 

In a statement, Atlantic City Mayor Don Guardian said he was "disappointed" in the decision to close Revel.

This might be Revel's last chapter, but not the last one for this building," he said. "My administration remains committed to the workers, the businesses and the visitors who are impacted by today's news."

Revel said it would honor reservations as long as it remains open, and its website Tuesday showed no sign of its financial turmoil.

But its calendar listed all of its rooms "Full" from now until the end of September.

Follow @TinaSusman for national news

tina.susman@latimes.com

 

Copyright © 2014, Los Angeles Times
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