The recession and the credit freeze that have sapped the strength of the gaming industry will not last forever.

Indeed, many economists think the national economy quit shrinking this summer and credit markets made a start at working normally again.

The Press of Atlantic City asked four experts what the gaming industry will look like - nationally and locally - when this economic downturn is fully behind us.

Michael Pollock, managing director of Spectrum Gaming in Linwood, said the U.S. gaming industry won't return to 2006 levels for a long time.

"Much of the revenue in that peak period was fueled by rising home equity, and people were not only not saving but they were spending down their assets," he said. "They spent a lot of apparent wealth in discretionary areas, and gaming was a big beneficiary."

Pollock said the timing of the financial meltdown was especially unfortunate for Atlantic City.

"The recession came two years too soon for Atlantic City," he said, putting off indefinitely Pinnacle's casino hotel and catching the Revel Entertainment Group's $2 billion casino hotel in mid-construction.

"If they can get the Revel project open, a lot happens as a result," he said.

The publicity and marketing such an opening generates is enormous, he said. "The project has a strong likelihood of success, bringing the benefit of a new demographic coming to Atlantic City," Pollock said.

Such expansion of the customer base is the key to the city's future success, and research shows the opportunity is there, he said.

"We did a visitor profile study a couple of years ago, and one of the things we found was that Atlantic City is only reaching 17 percent of its potential market," he said, citing the percentage of adult visitors from the city's primary markets. One way to address that is to offer a wider variety of amenities, he said. Another is to build up the convention and conference business.

"Conventions and business conferences will return to normal," Pollock said. "Markets that have casinos will be at a competitive advantage over those that don't."

Holly Thomsen, communications director for the American Gaming Association in Washington, said the gaming industry will recover with other consumer-driven industries, although frugality may prevail for a while.

"Even currently, in drive-in markets in particular, people are still visiting casinos and consider doing so an affordable and fun night out," she said. "Especially if they can go nearby, they set a budget, just like deciding to go to a restaurant or movie."

Casino customers are spending less now, but after the economy rebounds and they become more comfortable about their own financial futures, they'll spend more, she said.

Thomsen said AGA research shows people resume traveling, vacationing and seeking entertainment after a recession ends, and that will be true this time as well.

What probably won't come back fully is the level of capital funding casino companies enjoyed a few years ago.

"I doubt that the credit markets will return to what they once were for casino companies, but we're a solid industry, we create revenues, and we're still a sound investment," Thomsen said.

The big issue for Atlantic City is how to deal with competition throughout the Northeast that will get fiercer.

"The key for Atlantic City casinos ... is to really work at providing a unique experience that a visitor can't get anywhere else and to market that experience in new and creative ways," she said.

Thomsen said she feels confident the city's casinos will do well because they have a lot to offer.

"It's becoming more of a diverse destination market and I think that will continue," she said.

And gaming locations everywhere can count on the continued popularity of legal gambling, she said.

"The numbers have been consistent in the annual polling we've done the past 10 years, that about 80 percent think gaming is perfectly acceptable for themselves or others. We're still attracting millions of visitors a day," Thomsen said.

"The revenue varies depending on the location, but the popularity of casino gambling has not abated. People are just a little more cautious about their spending," she said.

Mark Juliano, CEO of Trump Entertainment Resorts, said consumers have been weakened by the recession and will bounce back at some point. But the industry will find they've changed.

"I do think when the consumer returns, he's a more cautious consumer," Juliano said. "We see that now already. Volumes are staying high in the hotels, but spending per customer is not what it used to be. I don't think that changes too much."

Atlantic City's casinos will have their own challenge coming out of the recession, he said, as the presence of competition in neighboring states changes the game here permanently.

"Continuing the long-term plan to develop the town into a full-service resort destination is going to become more and more important as people's desire for convenience gaming is met by local slot parlors and casinos," Juliano said.

Such plans - creating "a new, exciting place that convinces people who don't normally come to Atlantic City to give us a try" - will face credit markets that, like consumers, remain cautious, he said. Even after the recession has passed, lenders and investors will wait to see what the city's market looks like after it stabilizes.

For Juliano, all this gives an urgency to certain plans:

- "The most hopeful thing right now is get Revel finished. Nobody wants to see a half-completed building. That's No. 1."

- "We need to continue to focus on building our convention business, and our nongaming business through restaurants and entertainment."

- Capital investment by casino companies needs to be supplemented with funding from state agencies or authorities to market Atlantic City as robustly as Nevada promotes Las Vegas.

Juliano is confident the local industry, city and state can meet these challenges.

"Atlantic City has been around a long time and will be around a long time more," he said. "I'm a firm believer in the future of Atlantic City."

Cory H. Morowitz, chairman of Morowitz Gaming Advisors in Galloway Township, said the recession and credit crisis will permanently change the gaming industry.

The future won't bring back the significant capital spending and leverage that funded the industry's expansion earlier this decade, so projects will largely be confined to new jurisdictions such as Massachusetts, he said.

"Growth will be constrained. We'll go back to a time when projects are approved based on more stringent guidelines," Morowitz said. "The balance sheet will be more important, as opposed to cash flow."

And consumers will be slow to return to their old spending habits as they pay down debt and can no longer tap home equity, which will continue to limit casino revenues just as it shackles the economy as a whole. "This was a seminal event for this generation," Morowitz said.

In Atlantic City, the stronger casinos will do well, especially if they adapt. "It's still a viable market, but this market needs to change itself beyond a pure gaming market, whether it's regional conventions or driving visitation from nontraditional markets," he said.

Morowitz cited this month's targeted marketing by Harrah's to the gay and transgender community as an example of the kind of thinking the local industry needs - attracting patrons from markets currently not visiting Atlantic City.

How well local operators mine such underperforming markets will determine future levels of capital investment, he said. Lenders and investors will also watch closely the fate of the Revel casino hotel.

"New investment is dependent on how the market stabilizes, and when and if Revel gets open, and how well they do," Morowitz said. "If they do well, the way capitalism works, other investors will follow."

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