The one sure bet in Atlantic City the last 10 months was that the new $2.6. billion Revel casinos was likely to go bankrupt. Well, that bad bet just came true.
There was a reason why Morgan Stanley and other private investors walked away from the half-built casino after the 2008 financial collapse. Given the state of Atlantic City’s faltering casino industry, the Wall Street investors determined it was cheaper to cut their sizable losses and walk away from the Revel.
But Gov. Christie stepped in with $300 million in taxpayer money to get the casino up and running. Can you say bailout? Flush with house money, Revel rolled the dice.
From the start, the casino failed to attract the repeat gamblers needed to keep the slot machines spinning. Atlantic City is a mostly low-rollers market, supported by working class and elderly gamblers who spend hours at the slot machines. (Think Jersey Housewives, Sopranos and lots of senior citizens buses.)
The Revel tried to be an upscale casino that doesn’t allow smoking. But there aren’t enough James Bond types in Atlantic City to support the casino. Not to mention, the increased casino competition from Pennsylvania, Delaware, Maryland and the racino in Queens, N.Y. With gasoline back near $4 a gallon, there is no need to trek to dumpy Atlantic City when there are plenty of dumpy casinos closer to home. In fact, the growing glut of casinos raises questions about the whether the region is oversaturated and can support more casinos.
Other states will likely press on with their casino expansion plans, paving the way for more competition and more casinos going under. In the end, the big losers at the Revel will be the New Jersey taxpayers that Gov. Christie put on the hook for the $300 million in state funding.












