The Sky Is (Not) Falling On Atlantic City

If Chicken Little were a New Jerseyan — well, his name would probably be Chicky Little — but if he were a New Jerseyan, Chicky Little would be an Atlantic City casino executive. As in, the sky is falling. Continuously. Always.

The sky was falling in the early 2000s when regional casinos started popping up everywhere. The sky was falling in 2014 when The Atlantic Club, Showboat, Trump Plaza, and Revel all closed. The sky was falling when COVID hit in 2020. 

Now, the sky is falling once more, as there is a double whammy brewing: A trio of New York City casinos are set to open over the next few years, while the New Jersey Legislature could consider allowing casinos to be built at Monmouth Park and the Meadowlands.

In fact, Jim Allen, the chairman of Hard Rock Hotel & Casino, thinks Atlantic City casinos might take a 25-to-30% haircut from the arrival of the New York City casinos alone. He said this Wednesday at the East Coast Gaming Congress, held at his hotel.

New York execs don’t agree.

In about a month, Resorts World Casino at the Aqueduct Racetrack in Queens is going to open its full-fledged casino. Kevin Jones, the chief strategy officer for its owner, Genting Americas, thinks Allen is overstating the case.

He called the New York casinos a “a tremor, not an earthquake” for Atlantic City.

“We didn’t go try to capture Atlantic City,” Jones said. “The vast majority of our customer base is in Queens and Brooklyn.”

Frankly, I agree. 

Everyone be cool

The three New York casinos — two in Queens and one in the Bronx — are lovely for people who live in the outer boroughs. And, I guess, for some in Manhattan.

But really: Who in their right mind is going to schlep to one of these casinos if you live in New Jersey? And furthermore, Atlantic City will still retain its cultural cache here in the Northeast. 

“You wanna go to A.C.?” is a question that has been uttered probably a billion times in the last 50 years. I’m dubious that “You wanna go to Queens?” is going to replace that anytime soon.

Will the New York casinos bite into the bottom line in A.C.? I suppose. If it’s 25-30%, as Allen fears, I’ll bite into some Atlantic City sand. I just don’t see it.

The real threat (is not even real)

Then there’s the idea of North Jersey casinos at the racetracks. This, to me, is the real threat. This would be a big problem for A.C.

The execs agree.

“If you put casinos in North Jersey, you’ll still have casinos in Atlantic City,” George Goldhoff, president of Atlantic City’s Hard Rock casino, said in an Associated Press report. “But now there would probably be three or four at best in the market. It’ll go down by $600 million or $700 million. If New York in 2030-31, in the first 12 months that all three new casinos are open and you allow North Jersey casinos to open, that’s a tsunami on top of an earthquake for Atlantic City.”

Thankfully, humankind will have terraformed Mars before Monmouth and the Meadowlands have casinos. It is not going to happen.

For starters, New Jersey lawmakers would first have to pass legislation to amend the state’s constitution to allow for this. Already, virtually every (this is not hyperbole) state politician in South Jersey, from both sides of the aisle, is dead set against it.

But let’s say the legislature gets the votes. Then it has to go to the voters. 

And New Jersey voters are more likely to put ketchup on spaghetti than they are to allow this to happen. 

“New Jersey voters have twice rejected expanding casino gambling outside of Atlantic City, in 1974 and again in 2016,” Micah Rasmussen, the director of the Rebovich Institute for New Jersey Politics, told Casino Reports. “Sixty percent of voters opposed it the first time and more than 75 percent opposed it 10 years ago. In fact, I’d argue that voters weighed in a third time in 1976, when they approved casinos in Atlantic City only. The point is, New Jersey voters have repeatedly and clearly expressed their preference on this question, and at some point, do proponents just wear them down or do they piss them off?”

A recent FDU poll showed “piss them off” remains the heavy favorite, with basically no change to voter preference concerning the idea of casino expansion.

“People made up their minds about casino expansion a long time ago,” Dan Cassino, a professor of government and politics at Fairleigh Dickinson University and the executive director of the FDU Poll, said in a press release. “Unless something dramatic happens, putting the issue in front of voters is going to lead to the same outcome as it did before.”

Man in the mirror

So: The New York casinos will take some Atlantic City business, probably. The threat of North Jersey casinos is non-existent.

So what should Atlantic City actually be afraid of? Itself.

Atlantic City is not exactly a thriving metropolis off the Boardwalk area. This point was not lost on some executives at the conference.

“My focus is not on fear, but opportunity,” said Mark Giannantonio, president of Resorts Casino Hotel. “We know New York is coming. Atlantic City casinos can come out of this with a result that could surprise everyone.”

He wants to see the city, the casinos, and the state come up with ways to improve the city and thus improve the experience for visitors. If done right, he thinks the Atlantic City market could actually grow by up to 40%.

“Now is the time,” he said. “I don’t believe there’s a lot of runway.”

Now there’s a guy who doesn’t sound like ol’ Chicky Little. He sounds more like the Little Engine That Could. Instead of complaining about acorns falling on your head, Giannantonio is talking about fixing the tracks and climbing that hill.

You ask me, that makes a ton more sense.