Atlantic City’s largest casino union UNITE HERE Local 54 has issued a report saying the Revel Casino Hotel, once seen as being the saviour of Atlantic City, as only being worth between $25m and $73m, despite it being built at a cost of $2.4bn.
Casino union UNITE HERE Local 54 released the four-page analysis claiming that Revel’s own valuations ‘are not realistic and should not be trusted.’
Revel received over $300 million in subsidies from New Jersey, and entered bankruptcy less than a year after opening. Revel is widely reported to be for sale, and has not announced any plans to ensure job security for the existing workers in the event of a sale.
Ben Begleiter, a research analyst for Local 54, said: “We don’t think it’s in anyone’s best interest to overpay for this property. It’s not good for the industry or the workers. If the new owner does, they could be facing a more painful bankruptcy down the road, and that would be a hit to the employees as well.”
In the last three months of the year, it cut its losses by 43 per cent from $39m in the fourth quarter of 2012 to $22m in the fourth quarter of 2013.
Revel, which went through bankruptcy last year, has been locked into discussions with Local 54 since before it opened over its decision to employ non-union workers. Local 54’s analysis states that the casino won’t generate a profit until 2024. The union calculated the property’s worth using land value based on recent casino sales at between $1.25m and $2.71m an acre.
Revel reported an operating loss of $130m in 2013 but performed better in the fourth quarter of 2013 than it did in the fourth quarter of 2012.
Since Revel leaders announced the casino would pursue a sale, partnership or second bankruptcy last year, the union has re-engaged, calling on the casino to protect the workers.
Revel President Scott Kreeger recently responded to those criticisms saying that none of the casino’s potential buyers plan to shut it down. He also said he is not standing in the way of workers who wish to unionize.
Rebeca Franco, a cocktail waitress at Revel, said: “I’ve worked at Revel since the beginning, and this is the most chaotic it has ever been. There are rumours every day about a sale, and we are all worried whether we will lose our jobs. We need a new owner, and I’m committed to doing everything I can to make Revel a profitable casino, but we need more certainty in our lives. We need job security and a fair process to form a union.”
“Everyone says Revel is for sale,” said Equality Brown, an EVS worker at Revel. “I’ve heard all sorts of rumours about who might buy it. What I haven’t heard is what will happen to us. I want Revel to do great, and we will be the ones who make it happen. We need to know that we are going to be part of it, and we need a path to form a union.”
Rodney Mills, a buffet server at the Tropicana, said: “As a long-time Local 54 member, I know that Revel employees work as hard as we do. But Revel workers don’t have the job security, they don’t have the benefits and they don’t have the protections that we have as Local 54 members. I’m ready to do whatever it takes to help the workers at Revel achieve job security and a fair pathway to unionization.”
Bob McDevitt, President of UNITE HERE Local 54, added: “We’re ready to hit the reset button on our relationship with Revel and work together to make Revel and Atlantic City great again. In order to do that, the workers need to have job security and a process to join the union without fear of intimidation. Additionally, I call on all of the elected officials in the State who helped to get Revel built, to now stand up and support the workers at Revel.”
UNITE HERE Local 54 represents about 12,000 workers in 10 Atlantic City casinos.