Taj Mahal headed for closure

Taj Mahal headed for closure

August 04, 2016 8:40 AM
by

share

Trump Taj Mahal has become something of a graveyard for the big dreams of its billionaire owners.

Carl Icahn who hauled the Atlantic City resort created by his friend Donald Trump out of bankruptcy decided this week he has reached a line he is not going to cross and the Taj will close sometime after Labor Day.

Atlantic City’s main casino workers union has been on strike against the Taj Mahal since July 1. On Thursday, the strike will become the longest in the city’s 38-year casino era, eclipsing the 34-day walkout the union staged against seven casinos in 2004.

The shutdown will reduce the number of casinos in Atlantic City to seven. The job losses will be in addition to 8,000 workers who became unemployed when four Atlantic City casinos closed in 2014.

Icahn told the Associated Press Wednesday that he has lost nearly $100 million on the Taj and that is as far as he is going to go.

Closure of the Taj will mean that Icahn would then have two abandoned high rise casino projects. The Las Vegas project a  re--interpretation of Miami Beach’s famed Fontainebleau is still sitting unfinished on the north end of the Las Vegas Strip. Icahn bought it out of bankruptcy in 2011, but apparently hoped to sell it rather than finish it.

Whether there is any hope for last-minute compromises by the two parties in Atlantic City remains to be seen, but neither the union nor Icahn were sounding Wednesday as though they expect to back down.

The central issue in the strike is restoration of health insurance and pension benefits that previous owners got a bankruptcy court judge to remove in October 2014.

Icahn offered to restore health insurance to Taj Mahal workers, but at a level less than what workers at the city’s other seven casinos receive.

The union rejected that offer.

The Taj was the talk of the gaming world when it opened in 1990. Its debut fueled enthusiasm for other big projects elsewhere.

But fast forward to the present and it is clear that owners and regulators in New Jersey failed to reckon with the pressures competition  in other states would put  on Atlantic City casinos.