Pinnacle Entertainment Considers Dropping Atlantic City Plans
Atlantic City casinos have had their share of trouble recently. From the Tropicana being mismanaged to the point of losing its license, to the recent spate of citations for underage gambling, to the deterioration of revenues caused by the increased competition from neighboring states' slot parlors and racinos, there has been a steady current of unhapy news.
Now it seems that the forward-looking plans of casino operators to build destination casinos and exclusive resorts to rival Las Vegas may be in some trouble. Pinnacle Entertainment, which has planned to construct a $2 billion casino on the boardwalk, might not proceed with the project unless credit and economic conditions improve.
Pinnacle CEO Daniel Lee said Tuesday, "I've been asked, 'How the hell are you going to build in Atlantic City?' The answer is if credit markets don't improve, we won't build. We're not going to go broke building in Atlantic City."
The company stressed that expectations are for better financial conditions by the expected groundbreaking near the end of 2009. Pinnacle purchased the Sands Hotel Casino and demolished the older building to make space for the new complex.
Lee noted that other grandiose casino projects are stalled halfway through construction due to tightening credit markets.
If Atlantic City is to remain a viable and growing casino market, the town must continue its evolution to a Vegas-style scene. Daytrippers from New York, New Jersey, and Pensylvania will no longer support the city with cheaper and more convenient options at home. If Pinnacle is not prepared to advance, perhaps Las Vegas Sands or Wynn Resorts should bail them out and proceed with putting together a first-class resort.
