Atlantic City bankruptcies feared

Dec 16, 2008 4:41 AM
by Ray Poirier | Continuing their downward spiral, Atlantic City’s 11 casinos reported winning $345.5 million during the month of November, a decrease of 7.8% from the previous year.

Half the reporting casinos said their revenues had declined while only two reported increases.

Hardest hit during the period were Atlantic City Hilton Casino Resort and Resorts Atlantic City that were down 30% and 23.5%, respectively. The two properties are owned by a unit of Colony Capital and were acquired in a package deal that included casinos in East Chicago, Indiana, and Tunica, Mississippi.

The major losses at the two casinos prompted talks of bankruptcy. Resorts Atlantic City already has missed an interest payment that could lead to default on its loans and jeopardize its future.

Also causing comment was Trump Marina Hotel Casino, one of three properties owned by Trump Entertainment Holdings Inc. (TRMP). The Trump Marina, which was down 27% in November, is in the process of being sold to Richard Fields and his associates.

Trump Plaza Hotel and Casino was down 9.7% in November while the third Trump property, the Taj Mahal, was flat.

Executives of the Trump properties are attempting to restructure the company’s debt. The company missed an interest payment to bond holders and are taking advantage of a 30-day leeway to renegotiate the bond agreements.

Meanwhile, efforts are underway to expedite the sale of the Tropicana Casino and Resort that is operating under the guidance of a court-appointed administrator. The facility reported a decline of 10.8% during November.