With Sale of Former Sands Site, Questions Loom About Atlantic Club’s Fate
This week Pinnacle Entertainment unloaded a piece of Atlantic City real estate, the site of the old Sands, for almost $240 million less than the company paid for it seven years ago.
The new owner, Boardwalk Piers, has no immediate plans for the property for which it paid $30.6 million, this according to Casino Connection AC.
Casino property in Atlantic City has become hot real estate as the state gears up for the commencement of real-money Internet gambling. Being that New Jersey law requires that online wagering web sites be linked to a land-based casino property in the city, casino ownership stands to become a lucrative proposition once the market is up and running.
This adds a new layer of interest to the Boardwalk Piers purchase, begging the question of the value of such a deal when it is unlikely that the company can capitalize on the investment anytime soon should it decide to construct a brick-and-mortar casino. The company has not ruled that out, though an amusement park is also being considered for the land.
Should it opt to develop a casino, Boardwalk Piers said it would be doing so because of Internet gambling.
What lies ahead for the Atlantic Club?
In the months since Governor Chris Christie, a first-term Republican with his eye on the White House, laid pen to the state’s iGaming law, the announcement of a partnership between an online operator and a land-based Atlantic City casino has been a regular event. Atlantic City has a dozen land-based casinos, and one remains a major question mark. With no deal yet announced, many wonder who is going to buy the Atlantic Club Casino Hotel.
With companies like Wynn and 888 turning their attention to the Garden State, the Atlantic Club has yet to publicize any such agreement. Late last year, the parent company of online poker room PokerStars, Isle of Man-based the Rational Group, announced that it had struck a deal to purchase the struggling Atlantic Club – originally designed by Steve Wynn himself back in the early 1980’s – for a figure reported to be less than $50 million. The actual purchase price was far lower – $15 million.
By the spring, the Atlantic Club had terminated the deal citing the fact that PokerStars failed to acquire an interim operating license from New Jersey gaming regulators before a drop-dead date stipulated in the buyout contract. Though PokerStars had already paid $11 million toward the $15 million final price, a New Jersey court eventually upheld the Atlantic Club’s right to put the brakes on the deal, and allowed the ailing “locals only” casino to retain the $11 million as well.
Just who might buy the Atlantic Club is a question that many are asking but at least for the moment, nobody seems to be answering. The Press of Atlantic City reported this week that a Pennsylvania investor is sniffing around the Atlantic Club.
George Miller, a minority owner of a racino in the Keystone State, is eyeing the property along with a partner, Kevin Flynn, as they look to get a foothold in New Jersey, widely anticipated to be a very lucrative gambling market once regulated real-money online betting sites go live in November.
“We’re looking at properties. We’re looking all over the place. I have not eliminated the Atlantic Club,” Miller said.
Some months back, a rumor circulated briefly that Steve Wynn was possibly interested in once more controlling the Atlantic Club, but that appears to be unfounded.
Online powerhouse turns attention to the seaside city
Though PokerStars was unsuccessful in its bid to take over the Atlantic Club, it wasted no time in partnering with Resorts. This week, PokerStars made headlines again when it announced that, pending licensing approval from the New Jersey Division of Gaming Enforcement, it plans to construct a $10 million poker room at Resorts.
The room will be used as a link between the Resorts/PokerStars iGaming venture and Resorts’ land-based operations. Should the project come to fruition, Resorts plans to hold live poker tournaments in the room, something it has not offered since 2010. Players would have the opportunity to win tournament seats online.