Atlantic City Has $12.8M Debt Due Tuesday; Lenders Wary

Just how wary lenders are of Atlantic City’s credit is evident in their recent demands as the city tries to refinance $12.8 million in debt due Tuesday.

Three lenders expressed interest in making the loan, but one wanted to charge 12 percent interest. Another was willing to lend at a lower rate but wanted a state guarantee, which the state rejected, Mayor Don Guardian said Saturday.

Talks continued with a third prospective lender, and a decision is expected Monday, Guardian said, adding: “We are prepared to make the payment regardless.”

The financial turmoil in Atlantic City, half of whose gambling revenue has disappeared since 2006, has intensified in the last year, as four of 12 casinos have closed, and 8,000 people have lost their jobs.

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Wells Fargo To Purchase Revel Tax Lien For $26 million, Says AC Mayor

The failed Revel casino has yet to execute a sale of the property. But its outstanding tax bill at least will be bought, at Revel’s typical deep discount. The $32.5 million tax lien against the shuttered Revel casino that failed to sell at a city tax sale this month will be bought by Wells Fargo in a settlement for $26 million, Atlantic City Mayor Don Guardian said Monday.

Read more at http://www.philly.com/philly/blogs/downashore/Wells-Fargo-to-purchase-Revel-tax-lien-for-26-million-says-AC-Mayor.html#b98XQiBDtkW6pUCk.99

Bankruptcy Judge OKs Revel Sale To Brookfield

Map of New Jersey (Photo credit: Wikipedia)

A federal bankruptcy judge in Camden on Tuesday approved the sale of Atlantic City‘s Revel Casino Hotel for $110 million to Brookfield Asset Management Inc.

“I believe the high bid of Brookfield should be approved,” U.S. Bankruptcy Judge Gloria M. Burns said.

The sale will mark the beginning of a new chapter in the short and tumultuous history of the $2.4 billion property that struggled from the day it opened in 2012.

Read more at http://www.philly.com/philly/business/20141008_Bankruptcy_judge_makes_Brookfield_new_owner_of_Revel.html#9DfB3Aab1OpydZmT.99

Atlantic City’s Credit Rating Is Downgraded

Trump Taj Mahal, 2007 (Photo credit: Wikipedia)

ATLANTIC CITY – Standard & Poor’s downgraded Atlantic City’s credit rating from A-minus to BBB-plus on Monday, citing mainly the closing of four of 12 casinos this year.

The downgrade, which includes a negative outlook for the city, comes as Atlantic City is struggling with the loss of tax revenue because of the closures.

Combined, the shuttered gambling halls – Atlantic Club, Showboat, Revel and Trump Plaza, which closed last Tuesday – generated about $75 million in property tax revenue last year. A fifth – Trump Taj Mahal – may close in November.

Read more at http://www.philly.com/philly/business/20140923_JERSEY_SHORE.html#8By6Www9h9YC1lJB.99

Trump Casinos File For Bankruptcy

Trump Taj Mahal, 2007 (Photo credit: Wikipedia)

The purge of Atlantic City‘s weakest casinos continued Tuesday, as Trump Entertainment Resorts Inc. filed for bankruptcy in Delaware, a week before it plans to close Trump Plaza, putting a fifth Atlantic City casino in danger of closing this year.

After a previous bankruptcy in 2010, during which Donald Trump lost control of the company to hedge funds, Trump Entertainment attempted to retool its operations, but failed to increase revenue and profits, the company’s chief executive, Robert Griffin, said in a court filing Tuesday.

Operating losses at Trump Entertainment, which also owns Trump Taj Mahal, soared from $5.1 million last year to $25.7 million in the first six months of this year, Griffin said. That put the company in a cash crunch.

Read more at http://www.philly.com/philly/business/20140910_Trump_casinos_file_for_bankruptcy.html#bgqO4MgG4T3piOxI.99

Atlantic City Facing Unprecedented Economic Collapse

full-state map (Photo credit: Wikipedia)

The Atlantic City region is on the brink of a short-term economic disaster.

Atlantic City made history 36 years ago when it opened the first legal casinos in the United States outside Las Vegas.

Now it’s doing so again as casino employment – which for years exceeded the number of city residents – drops precipitously after a decade of steady decline.

The closing of three casinos, starting with Showboat and Revel this weekend followed by Trump Plaza two weeks later, and the rapid-fire loss of 5,700 jobs, draw historic comparisons to longer-term collapses of U.S. industries such as steel.

Read more at http://www.philly.com/philly/business/20140831_Atlantic_City_facing_unprecedented_economic_collapse.html#GmfpHBJZ5OpDgeaJ.99

Casino Closings Wipe $2 Billion From Atlantic City Property-Tax Values

English: Picture of the Tropicana from the Boardwalk. (Photo credit: Wikipedia)

The closure of three Atlantic City casinos by mid-September will wipe $2 billion from the city’s property-tax values next year, exacerbating the already cash-strapped city’s financial plight, Mayor Don Guardian warned Tuesday.

By 2017, Guardian said on a conference call to discuss Atlantic City’s way forward as a tourism center following the rout of its casino industry, property values are expected to have fallen to as little as $7.5 billion from $20 billion five years ago.

In the short term, Guardian said the New Jersey Department of Community Affairs has made money “available for some bridge loans to make sure that the city continues functioning with this year’s budget because of any concern that we might have that a casino’s closing, going bankrupt might hold off payments.”

Read more at http://www.philly.com/philly/business/20140827_Casino_closings_wipe__2B_from_Atlantic_City_property-tax_values.html#9bAf73M2kyMlu0jB.99