When it comes to casinos, location matters more than square footage.
That’s Golden Nugget Atlantic City’s mind set, and it appears to have paid off for its operators nearly two years after buying the former Trump Marina Hotel Casino.
With third-quarter net revenue of about $41 million, Golden Nugget is one of the city’s smallest casinos. But it also is the only property to notch an increase in third-quarter revenue for the past two years, including from 2010, when it was still the Trump Marina.
Part of Golden Nugget’s success, General Manager Tom Pohlman said, is attributable to its spot in the Marina District next to Borgata Hotel Casino & Spa and Harrah’s Resort — the city’s two highest-revenue-grossing casinos. Golden Nugget doesn’t need to top either one; it just needs to stay close, Pohlman said.
“We’re never going to top Borgata,” he said. “What we can be is somebody’s No. 2. Our goal is to be on somebody’s list.”
Of the city’s 12 casinos, Golden Nugget, Borgata and Harrah’s as a group account for about 40 percent of the net revenue generated in Atlantic City during the past two quarters. In July, more than half of the industry’s total casino wins were from those three properties combined.
That has some observers wondering whether the future success of Atlantic City will come from the Marina District more so than the Boardwalk casinos, particularly with plans to build a new conference center next to Harrah’s next year.
“You’re going to honestly see that area over there do better than the Boardwalk,” said Richard Perniciaro, dean for facilities, planning and research at Atlantic Cape Community College.
The Marina District and proximity to Borgata were two reasons Houston billionaire Tilman Fertitta chose to buy Trump Marina over the Boardwalk-situated Atlantic Club Casino Hotel and turn it into Golden Nugget in 2011, Pohlman said.
“There’s no doubt we’re happy being neighbors with Borgata,” he said.
After the $38 million purchase and $150 million in renovations, Golden Nugget has chosen to operate as a boutique-style casino with some nongambling amenities and only 727 hotel rooms. The main reason people visit Golden Nugget is to gamble, Pohlman said.
“Gaming is always going to be the lion’s share of what we do,” he said. Gambling proceeds represent about 75 percent to 80 percent of Golden Nugget’s overall revenue, he said.
In fact, the casino depends on entertainment at Borgata, buying tickets for shows there to give to high rollers at Golden Nugget.
But while Pohlman admits to drawing from Borgata’s clientele, Golden Nugget’s success can only help other properties in the Marina District by being an added attraction, said Joe Lupo, senior vice president of operations at Borgata.
“By increasing volume and increasing clientele, I think it can only help,” he said.
One of the reasons Marina District casinos appear to be doing better than some of their counterparts is that they don’t have to combat some of the negative perceptions associated with the Boardwalk, which Tourism District officials are trying to address through a “clean and safe” program designed to reduce crime and create public spaces that will draw visitors.
“That’s being done on the Boardwalk, and that’s important for the city,” Lupo said. “We really don’t have the work to be done on the marina, and that’s evident by the customers that come here.”
Rosaline Watson, a retired school teacher who lives in Mays Landing, is a regular visitor to Golden Nugget and, before that, Trump Marina. The property is easy to get to and easy to navigate inside, she said.
“I feel safer here,” Watson said. She said she stopped going to the Boardwalk when she started going to the casinos by herself. “I felt like I was looking over my shoulder.”
At the same time, the Boardwalk and The Walk retail district in Atlantic City are still considered two of the safest places in the region, said Brian Tyrell, associate professor for Hospitality and Tourism Management Studies at Richard Stockton College.
The college conducted a survey a couple of years ago, interviewing people in 75 spots in the region, asking them about their perception of safety. The Marina District was not part of the survey but likely would have ranked high with the Boardwalk and The Walk, Tyrell said. Efforts to improve safety and cleanliness will work to help solidify that perception, he said.
“We’re making progress,” Tyrell said.
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