We have an equal desire for each of Atlantic City’s casino hotels to succeed and contribute strongly to a revitalized destination resort — much the way parents love each of their children equally.
But just as the unlucky child struggling to find their footing occasions more worry and hope in the parents, the newest hotel in the city and largest in the state has kept us on an emotional rollercoaster for two decades.
Now the future for Ocean Casino Resort looks much brighter. Hope is turning into confidence in its success.
That was never the case in the past.
This most impressive casino building in the East began in 2006 with investment bank Morgan Stanley buying the land and designating Revel Entertainment Group to develop and operate the $2 billion casino hotel. The real estate-fueled U.S. economic collapse two years later put Revel and its financing under a menacing cloud. By 2010, Morgan Stanley decided to abandon the partly built hotel, taking a $932 million loss.
Worries that it would remain an unfinished eyesore turned to hope when Atlantic City casino leader Kevin DeSanctis beat the odds and got Revel sufficiently finished and opened in 2012, with nearly 1,900 rooms, 14 restaurants and 10 pools. Within another two years, though, its massive debt amid the sluggish U.S. recovery made it part of a wave of four casino closings in one year.
Whatever hope could be managed about the auction of Revel a few years later was hobbled when it defaulted to stalking-horse-bidder Glenn Straub. His ideas for it were fantastic and incredible — in other words, too much fantasy and too little credibility.
Then a Colorado investment group headed by Las Vegas-veteran Bruce Deifik bought the former Revel from Straub for $200 million and started its new life under the Ocean name. When he too couldn’t cover debt service on the hotel, hedge fund and lender Luxor Capitol Group assumed ownership in 2019.
Ocean Casino Resort has done much better under Luxor. It was the only Atlantic City casino to increase its gross operating profit for the first nine months of 2020 over the prior year period.
And now Luxor is bringing in a very solid partner with industry experience — Ilitch Holdings, whose companies founded or purchased by Detroit entrepreneurs Mike and Marian Ilitch include Little Caesars, the Detroit Red Wings, the Detroit Tigers and, most importantly, the MotorCity Casino Hotel. The organization’s companies employ 24,000 worldwide, have 350 million customer interactions annually and combined revenue of $3.8 billion (in 2018).
Luxor said strategic partner Ilitch will purchase a stake in Ocean Casino Resort of up to half. Soon afterward, the casino hotel said Luxor would fund $15 million in upgrades to the casino floor and other facilities.
The strong partner with gaming industry experience and possible synergies, combined with the inevitably rebounding U.S. economy and hospitality/entertainment industry, will give this gem on the Atlantic a powerful lift.
Two decades of hope that this stellar resort development would start reaching its potential are being justified.