this July 23rd file photo, people stand on a high deck at
Revel Casino Hotel in Atlantic City, N.J. Revel is
shutting down a little over two years after opening with
high hopes of revitalizing Atlantic City’s struggling
gambling market. The hotel closes Monday followed by the
N.J. - The most spectacular and costly failure in Atlantic
City's 36-year history of casino gambling begins to play out
Monday when the $2.4 billion Revel Casino Hotel empties its
Its casino will
close early Tuesday morning.
shutting down a little over two years after opening with high
hopes of revitalizing Atlantic City's struggling gambling
market. But mired in its second bankruptcy in two years, Revel
has been unable to find anyone willing to buy the property and
keep it open as a casino. It has never turned a profit.
So what killed
competitors say it was hampered by bad business decisions and a
fundamental misunderstanding of the Atlantic City casino
timing of it could not have been worse," said Mark Juliano,
president of Sands Bethlehem in Pennsylvania and the former CEO
of Trump Entertainment Resorts in Atlantic City. "The
financial climate while Revel was developing and when it opened
were completely different."
declined to comment.
broke ground just before the Great Recession. It ran out of
money halfway through construction and had to drop its plans for
a second hotel tower while scrambling for the remaining $1
billion or so it needed to finish the project. When it opened in
April 2012, it was so laden with debt that it couldn't bring in
enough revenue to cover it.
The idea behind
Revel was to open a totally different resort, a seaside pleasure
palace that just happened to have a casino as one of its
features. That included Atlantic City's only total smoking ban,
which alienated many gamblers; the lack of a buffet and daily
bus trips to and from the casino; and the absence of a players'
club. By the time those decisions were reversed, it was already
too late. High room and restaurant prices hurt, too.
had been a range of new attractions and potential customers with
enough discretionary income, I think that Atlantic City could
have absorbed the new capacity," said David Schwartz,
director of the Center for Gaming Research at the University of
Nevada Las Vegas. "That's certainly what happened with
Borgata more than 10 years ago. But the market that Revel
foresaw for its property just didn't materialize, partially
because of the growing perception that the city wasn't ready for
that kind of customer. At the same time, Revel didn't have a
plan to successfully market to the traditional Atlantic City
It also started
at a huge disadvantage by not having a pre-existing database of
gamblers to solicit, in the way that casinos owned by nationwide
companies like Caesars Entertainment or Tropicana Entertainment
Revel's design off-putting as well, said Joe Lupo, senior vice
president of the Borgata, whose upscale market Revel appeared to
target. Entering from the Boardwalk, they had to take a
vertiginous escalator up four flights to reach the casino floor.
Once there, the property wound around a circular pattern instead
of the linear layout of most other casinos.
struggled with the execution of plans to develop their market,
as well as with their design and just a basic understanding of
the Atlantic City visitor," he said.
A huge power
plant proved enormously costly. Some potential buyers in
bankruptcy court reportedly were scared off by the ongoing
expense of the heating, cooling and electrical plant, and they
sought unsuccessfully to exclude it from their purchase offers.
Juliano said Revel apparently hoped there would be additional
development in the immediate area that it could sell utility
service to, but that never materialized.
hopes to find a buyer for the property after it has ceased to
operate as a casino.