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Report says Revel casino will cannibalize AC markets

16 June 2009

ATLANTIC CITY, New Jersey -- As reported by The Press of Atlantic City: "Revel Entertainment Group's $2 billion megaresort may be the coup de grace for two or three of Atlantic City's weaker casinos if they aren't killed off even sooner by the recession, a new research report ominously predicts.

"The report, authored by gaming analyst Joel H. Simkins of Macquarie Securities, concludes that it may not be an entirely bad thing to lose smaller casinos that are stealing business from the healthier, major resort hotels.

"'(The) closure of two or more facilities in Atlantic City would be positive by eliminating the low-end as well as the more parasitic casinos that force other operators to drive down their margins,' Simkins wrote.

"Simkins said the opening of the Las Vegas-style Revel casino, itself struggling with financial troubles while it is under construction, should be "a transformational event" much in the way the upscale Borgata Hotel Casino & Spa began to attract younger and wealthier customers to the Atlantic City market.

"'While Revel may cannibalize many of the aging facilities in the market, it may be the shot in the arm necessary to take Atlantic City into a more positive direction,' he said..."

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