Atlantic City loses yet another casino as the Trump Taj Mahal shuts down for good.
Over the past two years, Atlantic City has seen great struggles when it comes to the gambling industry. For decades, Atlantic City stood next to Las Vegas as a top gambling destination in the United States. However, in recent years, casinos have shut down and the city has been left with massive debt that cannot be paid. Since 2014, four casinos have closed their doors and today marked the closing of a fifth Atlantic City closing, the Trump Taj Mahal. As of this morning, the Taj was shut down and the city was left with only seven gaming venues remaining.
The Trump Taj Mahal had been suffering for some time when billionaire business mogul Carl Icahn stepped in. Icahn spent a ton of cash, $300 million to be exact, to acquire the casino via Chapter 11 bankruptcy. Icahn had plans to revitalize the casino and as part of his plans, he wanted to save money. To be able to do so, he was granted the option to do away with health care and pension benefits of casino employees.
This did not sit well with employees who are members of the Local 54 Unite HERE union. The employees wanted their health care and pension plans back. Discussions soon began between the union and Icahn but no resolution could be made. By July 1st of this year, employees went on strike at the Taj. The strike continues and it was soon after it started that Icahn announced he would close the venue and then made official moves to do so.
Many people thought that Icahn was bluffing and would not go through with closing the venue. However, as of 5:59 am this morning, the casino was shut down. The property had done poorly for some time, seeing a 7.9% decline in earnings in August with only $116.5 million in revenues. Icahn was worried that he would not be able to make any money in the coming year and would actually end up losing as much as $100 million in 2017 if the venue had remained opened.
What Happens Now?
As far as the Trump Taj Mahal is concerned, the venue is closed. Players can still redeem any casino chips or gaming vouchers by visiting the Tropicana in Atlantic City, which is also owned by Icahn. The businessman has yet to announce what he plans on doing with the venue but one could imagine he will offload the property as quickly as he can to try and recoup some of his losses though there may not be any interested investors as Atlantic City continues to be in a decline.
With the closure of the gaming venue, only seven functioning casinos remain. This does not bode well for Atlantic City as they rely on the gaming revenues to survive. The city was actually facing a state takeover financially as government officials felt that the handling of city funds was done inappropriately. However, the city did gain time to try and rectify the situation. Many are hoping that a referendum on the November ballot will pass and the state will see two new venues added to the northern region of the state. It is believed that the casinos would be able to help Atlantic City as well as provide competition for neighboring states.
Only time will tell if Atlantic City will be able to survive the closing of yet another gaming venue. Will online gambling help the city stay afloat or perhaps the addition of casinos in the northern region of the state if voters decide to pass the referendum this election season?