Atlantic City's troubled Revel Casino Hotel on Thursday filed its second bankruptcy in just over a year and said it is hunting for a buyer.
The casino, which had gone through Chapter 11 bankruptcy in March 2013, warned employees on Thursday that it would lay them all off beginning on Aug. 18 if it could not find a buyer, according to a letter sent to staff, a copy of which was obtained by Reuters.It is the latest bit of bad news for the New Jersey seaside city, which has lost gambling customers as venues in nearby states expand and as the city has had to pay out millions to casino that successfully appealed property taxes as their values slumped.
Revel said it was seeking a buyer who would "have the ability to provide the funding and long-term commitment to help Revel reach its full potential." The casino said it would shut its doors if it could not find one, according to the letter sent to staff.
The company said in a statement it will continue to operate normally while in bankruptcy.
"We will work to reach an agreement with a new owner who ... shares our commitment to providing Revel’s guests and players an exceptional experience,” Scott Kreeger, president and chief operating officer, said in the statement.When it opened in April 2012, Revel, built for $2.4 billion, was a centerpiece of New Jersey Governor Chris Christie's effort to bring Las Vegas-quality gambling to Atlantic City's declining gaming business.
Christie had provided a $261 million tax package to help build Revel after Morgan Stanley, which had begun building the casino, pulled out of the project two years ago and took a $932 million loss.
Revel never lived up to financial projections, filing for bankruptcy in March 2013 and emerging two months later.
Casino revenue from Atlantic City has roughly halved since 2007, while total U.S. casino revenue in 2012 was still shy of a 10-year peak of $37.5 billion in 2007, according to the American Gaming Association.
Compression in big gambling markets like Atlantic City can be attributed in part to increased efforts by states to expand their own gambling offerings in search of new revenue sources, CIT's Steve Epperly said in a report this week.
In Philadelphia, only about an hour's drive from Atlantic City, a court this week paved the way for more gambling, rejecting an effort to block a gaming license.Revel's workers, who in June voted to unionize with Unite-HERE Local 54, supported the search for a buyer."We believe a sale of Revel to a buyer who wants to keep the property open and retain the employees is the best thing for the workers," Unite-HERE President Bob McDevitt said.
(Reporting by Hilary Russ, Nick Brown; Additional reporting by Jonathan Stempel; Editing by Bernard Orr and Leslie Adler)