It’s hard to imagine anyone who has been paying attention was blindsided by Wednesday’s announcement that Hard Rock International has decided not to proceed with its planned, $300 million “boutique” casino-hotel project at Albany Avenue and the Boardwalk.
Actually, it would have been exponentially more surprising had the company trumpeted plans to put shovels in the ground. That’s because the reality was that construction and completion were never legitimate options.
First of all, Atlantic City remains a bad bet for big-time lenders. That Morgan Stanley, which originally anted up to get Revel’s construction started, had to eat a billion bucks to get out of town surely was noted by other financial institutions. And despite a decent year-to-year spike in August gaming revenues, business by-the-sea remains dismal (to be kind). So who, exactly, was going to finance this deal?
As gaming analyst Andrew Zarnett of Deutsche Bank AG told the Inquirer’s Suzette Parmley, “I think there has been visibility that the Atlantic City market has been deteriorating greatly the last six years. In a declining-demand environment, the last thing that the market needs is new supply.”
Then there was the buzzed-about internal opposition to Atlantic City on the part of the Florida-based Seminole Indian tribe, which owns the Hard Rock casino brand. Sure, the guy who runs the tribe’s gaming operations, Jim Allen, was gung-ho on AyCee, but Allen is an Atlantic City native. The tribal leaders to whom he reports were, apparently, opposed to this project from Day One.
So, if the Hard Rock Atlantic City plan was pretty much a mirage all along, then why would Wednesday’s news be significant? After all, you can’t lose what you never had.