Tom Ballance likens himself to a new football coach who inherits a Super Bowl-caliber team led by a star quarterback.
Under such circumstances, he notes, it would make no sense shaking up the game plan.
“That would be analogous to a coach benching Tom Brady,” Ballance said of the future Hall of Fame quarterback for the New England Patriots. “You have the best player in the world, and you wouldn’t want to put him on the bench.”
In this case, the star “player” is a casino, not a quarterback. Ballance has taken over as the new president of Borgata Hotel Casino & Spa, Atlantic City’s top casino.
Ballance, a 32-year veteran of the casino industry, stressed that he plans no radical management changes at Borgata. But he has stepped in at a time when competition from casinos in surrounding states is as intense as ever. Even the powerhouse Borgata saw its Atlantic City-leading gambling revenue fall 6 percent in 2012. Profits are shrinking, too.
Ballance seems unshaken. He said he feels no pressure from Borgata’s Las Vegas-based parent company, Boyd Gaming Corp., to boost financial results.
“There is only one imperative marching order that you get from Boyd, and that is that you are to operate with the highest level of integrity. That is pretty much it,” he said.
But there are no plans to put Borgata on cruise control while the competition grows and profits decline.
For 2013, Borgata will spend about $25 million to redo 80 suites, renovate the hotel lobby, give its mur.mur nightclub a facelift, renovate its public bathrooms and buy about 400 new slot machines.
Borgata responded to the opening of the new $2.4 billion Revel megaresort in Atlantic City last year by refurbishing its main 2,000-room hotel tower. The $50 million project, completed in June, gives Borgata what Ballance calls the best guest rooms in the market.
“We continue to have the cleanest, freshest and most up-to-date product in this region,” he said.
As for the rest of Atlantic City, Ballance said he is encouraged by projects such as the Margaritaville-themed expansion at Resorts Casino Hotel and the rebranding of the former Trump Marina Hotel Casino into the Golden Nugget.
He also praised city and state officials for the development of the Tourism District, which is designed to make Atlantic City safer and cleaner for visitors.
The proposed legalization of sports betting and Internet gambling would further boost the city as it looks to distinguish itself from rival casino markets in neighboring states, Ballance said.
When more conventions start coming to town, Atlantic City should evolve into a full-fledged destination resort — a place where tourists can spend longer vacations and spent more money, he predicted.
From waiter to casino president
The 54-year-old Ballance was the first Atlantic City employee that Boyd hired in 1998, when plans for Borgata were still unfolding. He was brought on as vice president of development, a key position in the design, construction and opening of the $1.1 billion casino resort.
“I joke with people that Borgata’s first executive office was my dining room table,” he said of the early days of the project.
Ballance and other members of the development team, including Borgata’s mastermind, Robert Boughner, crafted a luxurious, Las Vegas-style casino that was designed to appeal to the Atlantic City “rejectors,” the high-end customers who previously had no interest in the city’s gambling scene.
“We had incredible autonomy to conceive the project, after we figured out what would be the most successful business model,” Ballance said.
Following Borgata’s 2003 opening, it wasn’t long before it established itself as Atlantic City’s No. 1 casino under Boughner’s leadership. Boughner, who left Atlantic City for a time to oversee a now-dormant Las Vegas project, returned to Borgata in 2009 to take charge again. However, Boughner was called back to Las Vegas again in the fall for additional duties at Boyd, opening the door for Ballance to become Borgata’s new president and chief operating officer.
Other than Ballance’s promotion to the top spot, Borgata’s senior management team remains the same. The other members are Joe Lupo and Auggie Cipollini, both of whom hold the title of senior vice president of operations.
Ballance’s Atlantic City casino career started humbly in 1980. At that time, he was a food-service waiter at the old Golden Nugget casino. That was Atlantic City’s original Golden Nugget, the Boardwalk property owned by casino mogul Steve Wynn, not the latest edition of the Golden Nugget in the Marina District.
Ballance, who lives in Egg Harbor Township, began his casino career after graduating with a business degree from The Richard Stockton College of New Jersey. From Golden Nugget, he jumped into management at Harrah’s Resort. He climbed the executive ranks at Harrah’s before leaving to join Borgata.
“There are people who came out of Harvard and were successful gaming executives, and there are people who waited tables and came out of Stockton and who are successful,” he said.
So the waiter-turned-casino boss now finds himself heading one of the country’s top casinos. One analyst said Borgata is so dominant that it can influence the Atlantic City market all by itself.
“As a casino, you’ve got to advance your own bottom line, but there’s also a sense that when Borgata endeavors to speak for the entire industry, it has a very loud voice,” said Michael Pollock, managing director of Spectrum Gaming Group, a Linwood-based casino consulting firm.
Borgata leads market
In Atlantic City, Borgata remains unchallenged in gross gambling revenue. It ended 2012 with $612.7 million in winnings, compared with second-place finisher Harrah’s Resort at $399 million.
“We control 20 percent of the gross gaming revenue in town,” Ballance said. “That’s amazing that one of five gaming dollars spent in Atlantic City is spent in this building.”
Borgata perennially is Atlantic City’s most profitable casino, too, but Harrah’s is proving to be a formidable challenger. Through the first nine months of 2012, Harrah’s had moved ahead, posting $108.8 million in gross operating profits to Borgata’s $106.1 million. Year-end profit figures will not be announced until April.
Before the market had its downturn, Borgata’s operating profits peaked at $256.4 million in 2005. By 2011, its operating profits slipped to $162.6 million.
Analysts warn of struggles ahead as Borgata and other Atlantic City casino operators look to break out of a six-year slump that has cut gambling revenue more than 40 percent industrywide since the market’s 2006 peak of $5.2 billion.
The casino industry suffered an 8 percent drop in gambling revenue in 2012, coming in at $3 billion. Analyst Andrew Zarnett of Deutsche Bank issued a year-end summary ominously titled, “Atlantic City: A Cold Winter Starts.”
Zarnett predicted further declines for Atlantic City revenue into 2013, blaming the lingering effects of Hurricane Sandy, tighter consumer spending and growing casino competition in the Northeast.
Pennsylvania topped Atlantic City in total gambling revenue for the first time in 2012, underscoring just how fierce the competition has become in recent years. Pennsylvania’s 11 casinos ended the year with $3.1 billion in total revenue from their slot machines and table games, compared to $3 billion for Atlantic City’s 12 properties.
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