Trump Denies Any Casinos Are for Sale : Finance: The flamboyant New York developer still has to work out his cash-flow problems. Some analysts are doubtful.

Under a withering barrage of publicity, New York developer Donald Trump took the offensive Thursday, dispatching his top gambling executive to deny that any of Trump’s three casinos in Atlantic City are on the auction block.

“The properties are not for sale,” Edward Tracy told a news conference at the Taj Mahal Hotel & Casino, the $1-billion gambling house that Trump opened this spring. “Not Trump Plaza. Not Trump Castle. Not Trump Taj Mahal. We are going to produce an avalanche of cash from these three facilities.”

The casino operations are supposed to be the cash cows of the Trump financial empire, but lately they have been shaken by management turmoil, employee layoffs and a sharp slowdown in the Atlantic City gambling market.

“Donald’s problems (in Atlantic City) are not just his alone,” said a spokesman for Resorts International, which owns a casino adjacent to the Taj. “The whole industry is having (financial) problems.”

Tracy confirmed that 450 employees, mostly food-service workers, had recently been discharged from the Taj even though the casino hotel opened only two months ago.

Tracy’s news conference was an attempt to counter endless rumors about Trump’s plans and to quell escalating doubts about the viability of his real estate empire, centered largely in Atlantic City and Manhattan. (He is also part of the investment group that owns the Ambassador Hotel site on Wilshire Boulevard in Los Angeles.)

Swaggering and abrupt, Trump gained a larger-than-life reputation in the 1980s as a colorful, high-living real estate developer who pulled off big deals while quarreling loudly with anyone who got in his way. But 1990 has not gone well, and the Trump mystique of invincibility has all but been erased in a few months.

Trump is caught in a severe cash bind caused by lower-than-expected casino revenues and a real estate recession in the Northeast that has rendered him unable to sell or finance his Manhattan properties at an attractive price, financial experts say.

Earlier this week, Trump confirmed that he was negotiating with his major creditors, four New York banks that are uneasy about his loans of $2 billion. The banks reportedly want Trump to scale down his lavish lifestyle and restructure his finances, possibly by selling some assets.

News of Trump’s latest financial troubles this week severely depressed the value of the bonds used to finance construction of his casinos, and some financial experts now wonder privately if he can solve his problems without being forced into bankruptcy court.

The problems may come to a head next week when a $25-million payment to bondholders of the Trump Castle falls due. Tracy declined to say whether the payment would be made. Trump did not attend the press conference.

Many financial experts believe that Trump’s troubles stem largely from his penchant for buying trophy real estate at top-dollar prices, betting that the value of these assets could only go up.

Some of his best-known properties are the Trump Shuttle, which he bought last year from Eastern Airlines, and the Plaza, one of New York’s most elegant hotels. Both are said to be losing money because Trump went so heavily into debt to buy them.

“He was convinced that things were always going to go up,” said James Grant, publisher of Grant’s Interest Rate Observer, a financial-industry newsletter. “Well, they didn’t go up.”

Trump’s problems are also evident in Atlantic City, where he operates three casinos in competition with one another in a gambling town that has shown little revenues growth in the past year.

“Right now, he’s fighting himself,” one competitor said. “One (casino) is cannibalizing the other.”

Trump’s problems also highlight the damage done last October when his top casino executive, Stephen Hyde, was killed in a helicopter crash. Hyde’s death left a giant hole in the Trump organization that has yet to be filled, one competitor said.

“Hyde acted as a buffer between the rank-and-file and Donald,” he said. “Since Steve’s death, Trump has not been able to attract the people that he wanted.”

And since Hyde’s death, Trump has taken an increasingly active role in running the casinos, with decidedly mixed results. Several top executives have either quit or been demoted in recent weeks.

Though the Taj is doing a brisk business, the money it brings in is not enough to pay the bills, outside experts maintain. The opulent Taj, far and away the gaudiest casino ever built along the Atlantic City Boardwalk, was the top revenue producer in May, with gambling winnings alone of $36.5 million.

“The Taj is doing a terrific business,” one casino-industry expert said, “but it’s terribly expensive to operate.”

Industry experts believe the Taj needs to generate a minimum of nearly $40 million a month, and perhaps much more, just to break even. Tracy disputed that figure, though, saying the break-even level is about $33 million a month. He added that the Taj brought in $50 million in revenues in May.

Gambling winnings at Trump Castle have been flat this year and fell 17% in May compared to May, 1989, a showing that placed it ninth among the city’s 12 casinos, according to figures from Atlantic City Action, a casino-industry newsletter. Trump Plaza was No. 2 in May, but revenues for the first five months of 1990 fell more than 2% compared to last year.