Golden Nuggets Owners Look to Sell?
In another sign of the hard times that have plagued Atlantic City for more than half a decade, the parent company of the Golden Nugget there are rumored to be looking into selling off the property, reports the Press of Atlantic City.
Those close to the company cite poor revenue as a motivation for the move, according to the Press.
Company in good position fiscally; city not so much
In the face of rising competition as land-based casino gambling expands nationwide – but particularly along the eastern seaboard – New Jersey has found its casino industry losing out to neighboring Pennsylvania as patrons have bypassed Atlantic City in favor of newer, glitzier casino properties in the Philadelphia area.
The Golden Nugget, which was purchased in 2011 by the Texas-based entertainment and dining company Landry’s, has not been immune to the downtick in visitors and revenue in Atlantic City.
All twelve land-based casinos in the once-bustling seaside resort town have experienced difficulty since Atlantic City revenue peaked back in 2006. When Landry’s, which is run by billionaire Tilman Fertitta, acquired what was formerly known as the Trump Marina Hotel Casino in 2011, it invested about $200 million in purchasing the existing property and remodeling it into what is today the Golden Nugget.
This week Fertitta indicated that there is “interest from outside parties” in purchasing either the land-based hotel/casino property or its accompanying Internet gaming rights, or both.
Last year the Golden Nugget recorded operating losses of $11.4 million, and in the first half of 2013 the loss figure was at $8.6 million.
Internet gaming component could be sold off independently
While analysts have noted that it is difficult to predict a sale price for the Golden Nugget, there is one thing on which everyone can agree – that being that the property’s Internet gaming rights stand to be incredibly lucrative. As such, Landry’s may have an interest in selling off those rights separately from the land-based venture.
New Jersey became the third state in the nation last February to regulate some form of Internet wagering when first-term Republican Governor and presumed 2016 presidential hopeful Chris Christie inked into law the state’s online gambling bill, in part to stimulate Atlantic City’s stagnant economy.
New Jersey will allow for a comprehensive suite of betting options, from online poker to classic casino games in virtual form. Games are expected to go live this November.
In recent months, all of the land-based casinos in Atlantic City have entered into partnerships to operate online gambling sites, which some industry experts believe will have the ability to completely transform New Jersey’s struggling casino industry. The state’s online betting law requires all licensees be tied to a land-based property in the city.
Management confirms interest in sale
Meanwhile, Tom Pohlman, who is both executive vice president and general manager of the Golden Nugget, released a statement on Friday confirming that Landry’s may be interesting in unloading the property.
“In light of our $200 million investment in this gaming asset and less than stellar results in the Atlantic City market, Landry’s indicated to Houlihan Lokey that it would listen to any proposal,” Pohlman said.
“Unlike the majority of the Atlantic City casinos, Landry’s has no outstanding debt on the casino and remains committed to the Atlantic City marketplace and Internet gaming,” Pohlman continued.
