Hard Rock CEO praises ‘world class’ New Jersey gambling industry

Hard Rock Atlantic City opened its doors for business in late June of 2018 and Ocean Casino Resort opened at about the same time. Many in the New Jersey casino industry did not know if the two new operations would integrate into the gaming market in the Garden State. However, in 2020 Hard Rock has shown solid growth and is one of the top-performing casinos in Atlantic City.

While Jim Allen, CEO of Hard Rock International, recently spoke in negative terms about the direction that Atlantic City has taken, he is happy with how his casino property, which is a $500m+ rebranding of the former Trump Taj Mahal, is doing in the market. He also had positive words when speaking about the New Jersey sports betting industry, describing the state’s regulatory environment as “world class”.

“No jurisdiction in the world can rival what New Jersey’s doing. I think all of those things are absolutely excellent,” Allen said.

In January of 2020, there was $540 million wagered on sports in New Jersey. The holders of sports betting licenses in the state reported a solid revenue stream to the tune of $53.6 million, which is an increase of some 185.2% over January of 2019.

Hard Rock keeping up with Atlantic City’s big boys

While the Hard Rock Atlantic City is still in its infancy, the casino has stacked up well against other properties that have been around for decades. According to the New Jersey Division of Gaming Enforcement, Hard Rock had the third-highest total revenue in January of $21.5 million, which is a year-on-year increase of 38%. The only two casinos that took in more last month were Borgata ($54.7 million) and Harrah’s ($23.5 million).

In terms of overall results for last year, Hard Rock AC was second in casino win with $324 million and came third in terms of overall gaming revenue at $350 million.

“We’re certainly very pleased with the results,” said Allen.

“To do that in our first year of operation up against some very successful brands like Harrah’s and Caesars, and Tropicana who have been there for 30, 40 years with 40 million people in their database, I think that’s something that we’re very encouraged about.”

Saturation issue in Atlantic City casino industry

One of the main issues in Atlantic City is the question of whether or not the market is saturated by too many casinos. Four of the 12 land-based casinos closed their doors in 2014 and the Taj Mahal did the same in 2016. Hard Rock International bought the old Taj property in 2017 and began the process of transforming it into the Hard Rock Atlantic City.

As of February 2020, there are nine land-based casinos in Atlantic City. The Showboat may reopen its casino, which many – including Allen, whose property is next door – are opposed to. However, the Hard Rock CEO has stated he does not know exactly how many casinos can operate at a sustainable level in Atlantic City.

“I don’t know if I have a specific comment on the correct number, but what I do feel very strongly about is that if there’s nine or 10, or five or six, the quality of the product that’s being offered is the most important thing,” Allen said.

When casino properties are out of action for years at a time, it has an impact on the Atlantic City casino market and the local economy on the whole. On that point, Allen stated, “To have facilities open that haven’t been renovated in (a number of) years, whether it be room product or public areas is, to me, the most important part of the conversation. It becomes detrimental if proper reinvestment in capital expenditures into the buildings doesn’t occur.”

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