This could be the start of something big in Atlantic City…maybe big enough to get dealmakers up and moving in other states as the corporate parent of Internet poker giant PokerStars and the born-again Full Tilt consider buying one of the Boardwalk’s troubled casinos.
What might New Jersey casino regulators say about the possible sale of the Atlantic Club to this would-be buyer? This was the question asked in one news account about the pending deal.
The likely response? Possibly something like, “how soon can you get here?”
Tough questions could be asked but regulators in both New Jersey and Nevada are taking a, uh…well, let’s call it a gentler view than in the old days, a half-dozen or more years ago. Those days were before economies based on the gaming and entertainment business soured and anxiety levels began building among government. Back before business leaders who monitor spending levels and the tax revenues/jobs the spending supports.
As for the current state of things in this East Coast gambling town, they could not be much worse. Atlantic City’s struggling casino industry can certainly use everything the Rational Group – that’s the parent company of PokerStars and Full Tilt seem ready to offer.
There would be an investment of the millions necessary to restore the former Hilton property to something resembling good health and guarantee thousands of jobs as Atlantic City becomes an instant leader in Internet gaming.
It’s the kind of big deal involving big names that could encourage activity from Las Vegas to just about everywhere. But certain important things have to happen first and it is likely they will. It’s hard to believe Gov. Chris Christie will not sign the latest version of an Internet poker bill that recently landed on his desk, particularly when we consider the time and energy he and his team have put into their ongoing efforts to legalize sports wagering, a far more controversial and complex project than that involving poker.
But who knows what a professional politician is going to do when push comes to shove and lawyers begin their arguing on behalf of a number of special interests. So the Rational Group may be waving a carrot in Christie’s face, hoping he will do the rational thing.
Yes, messages are being sent and their meaning has to be loud and clear to both Christie and Atlantic City leaders who could really use some good news as casinos on the Boardwalk and the nearby marina area continue to struggle against the pressures generated by competition elsewhere.
Look what we will do for Atlantic City if this legislation is signed. That’s the obvious message in the announcement by the corporate parent of Full Tilt and PokerStars. If, for whatever reason, Christie decides to reject the Internet legislation, – he must take action by Feb. 3, or it becomes law without his signature – it doesn’t take a rocket scientist to figure out the offer to buy the Atlantic Club for a reported $50 million would be withdrawn in a hurry and the casino would resume its path toward a long-threatened foreclosure.
About that $50 million figure: assuming news reports are accurate, this offer for the Boardwalk’s most down-at-the-heels casino suggests the possibility of a spike in casino prices. Good news perhaps for Pinnacle, which is still sitting on its Boardwalk acreage hoping for an offer it cannot refuse. The Trump Marina and Resorts casinos were in somewhat better shape than the Atlantic Club when they sold for less than $40 million each a couple years ago.
Fifty million is not a big spike but Atlantic City casinos will take an upturn of any kind at the moment. The last several years have not been kind to casino owners who will welcome the look of uniqueness Internet poker promises.
The legislation sitting on Christie’s desk requires that the base of operations for each Internet operation be in one of the Atlantic City casinos. With Internet poker expected to spread on the basis of regional compacts among states, New Jersey with its population of close to nine million offers a far more appealing starting point toward future growth than does Nevada with less than three million.
Phil Hevener has been writing about the Nevada gaming business for more than 30 years. He can be reached at [email protected].