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Atlantic City Round-Up

26 February 2002

by Joe Weinert

ATLANTIC CITY -- Resorts Atlantic City filed paperwork resurrect a $125 million hotel expansion that became a Sept. 11 casualty. Casino officials indefinitely postponed the project in October, the result of poor financial markets.

"The high-yield markets have improved dramatically since Sept. 11 and our investment banker, Merrill Lynch, along with us, thought this would be a good time to do a funding," Vice Chairman Nicholas Ribis said.

Resorts plans to demolish an aging hotel tower that has 166 substandard motel-style rooms and replace it with a 28-floor, 459- room tower. Demolition work could begin in late May, with the new hotel rooms open in early 2004. When completed, Resorts would have 937 hotel rooms.

Resorts intends to issue $170 million in first mortgage notes to finance the project. The amount would also enable Resorts to retire $92.7 million in bank debt used by parent company Colony Capital to buy Resorts last April.

*****

Revenue in Atlantic City,s nickel slot machines jumped 62.1 percent last year, to $560.5 million, as gamblers moved away from quarter and dollar machines.

"I guess what's fueling this is that these are mutticoin games, with nine (pay) lines in most situations. They,re a lot of fun, with lots of ways to win, and generally the rate of return on these machines is much higher than it was years ago,? said Tom Reale, executive director of slot operations at the Sands.

Reale said the nickel games carry a 5-cent denomination in name only: the average wager on a nickel machine at the Sands is $1.05.

Nickel slot revenue on the Las Vegas Strip, meanwhile, grew 28.1 percent last year, to $444.8 million, according to a Jefferies & Co. analysis.

*****

Tropicana, continuing to zag when its competitors zig, has booked another unusual nongaming attraction: "Prehistoric Worlds -- Backyard Discoveries,? an archeological exhibit presented by the Discovery Channel.

For two months, visitors to the Boardwalk casino can view ancient remains and interactive displays of modern exploration technology. The exhibit features a recreated ice cave that houses a 23-ton permafrost block encasing a 20,000-year-old Jarkov woolly mammoth.

The two-month display begins March 23. It,s free for members of Tropicana,s players club, $4.95 for adult non-members and $3.95 for kids.

Tropicana has previously booked two exhibits of Titanic artifacts, an exhibit of the dresses of Princess Diana and a display called "Torture Through The Ages."

The casino is currently reaping publicity for live chickens that play hundreds of visitors daily in games of tic-tac-toe. The chickens will be roosting at the Las Vegas Tropicana beginning in late spring.

*****

Some of the biggest names in the gaming industry will convene in Atlantic City for the Mid-Atlantic Gaming Congress on May 22.

An "Industry Leaders? panel is scheduled to included Terry Lanni, chairman and CEO of MGM Mirage; Phil Satre, chairman and CEO of Harrah's Entertainment Inc.; Paul Rubeli, chairman and CEO of Aztar Corp; Don Snyder, president of Boyd Gaming Corp.; and Frank Fahrenkopf, president of the American Gaming Association.

****

New Jersey Gov. James E. McGreevey named an Atlantic City-area labor leader to be chairman of the Casino Reinvestment Development Authority, the agency that uses 1.25 percent of casino revenue to fund redevelopment projects, including casino hotel expansion, in Atlantic City and throughout the state.

Edward H. Gant is president of the South Jersey Buildings Trades Council and also business manger of Local 351 of the International Brotherhood of Electrical Workers. He replaces Republican Frederick Nickles, who has been CRDA chairman since 1994.

*****

Atlantic City's chief casino competitors enjoyed healthy beginnings to the new year.

In Connecticut, the Foxwoods and Mohegan Sun tribal casinos reported January slot-machine revenue of $107.2 million, up 8.6 percent over the same month last year.

In Delaware, the three racetracks reported slot revenue of $40 million for the 28-day January reporting period, up 11.5 percent over the year-earlier period.

This year's January period, however, included New Year's Eve.

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