ATLANTIC CITY, NJ—With the prospect of the city's boardwalk being down to just nine casinos by September, Atlantic City is going through a shakeout due to what analysts say is an oversupply of gaming establishments.
So far this year the Atlantic Club has shut its doors, the Revel faces closure if it cant find a buyer and Caesars Entertainment announced last week that it plans to shutter the Showboat Atlantic City Hotel and Casino on Aug. 31.
Atlantic City Mayor Don Guardian said in response to the announcement of the Showboat's pending closure, "Although it is sad today, it's part of the transition that Atlantic City needs to have. There is pain as we go through this transition, but it's critical for Atlantic City to realize we are no longer the monopoly of gaming on the East Coast. If you build more and more casinos and don't increase the amount of people coming to them, you're sharing that wealth. We're just going through a very difficult time."
Israel Posner, executive director of the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton College, tells the Associated Press that Atlantic City has been dealing with casino saturation for some time. "We know that the oversupply of gaming product is a regional issue, as we're seeing the effects of the pressure all around Atlantic City," he says.
Srihari Rajagopalan, a debt analyst with UBS, says in relation to the fiscal woes of some gaming operations in Atlantic City, "You are seeing the market right-size, which is a positive. There are unprofitable casinos shutting down." See story in the Star Ledger.
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