Supplier News
US- Deutsche Bank predicts more closures following Showboat announcement
By Phil - 22 August 2014
Deutsche Bank believes that Atlantic City’s casino sector will be reduced from 11 to six casinos by 2017.
The prediction followed the news that New Jersey’s Division of Gaming Enforcement had issued its final closing order for Showboat Atlantic City, which will end gambling operations at the end of August.
The announcement that Showboat will close follows similar news from Revel and Trump Plaza.
Deutsche Bank believes that Resorts and Trump Taj Mahal will ‘join the list of shuttered properties’ in coming years.
“By 2017, we foresee Atlantic City to have two center boardwalk casinos (Caesars and Bally’s), the Tropicana, and three casino hotels located in the Marina district (Borgata, Harrah’s, and Golden Nugget),” the report said. “Our revenue expectation for AC in 2017 is US$1.8bn.”
This represents a 36.5 per cent drop from 2013. The value of Atlantic City’s casino sector has nearly halved since 2006 when it peaked at US$5.2bn.
“We turned bearish on Atlantic City in 2006 (and continue to be bearish to this day) as we believed increased regional competition would take its toll on Atlantic City. It has and it will continue to do so,” Deutsche said.
