Revel Casino-Hotel, perhaps the most ambitious property to ever grace the Boardwalk, is scheduled to close by Sept. 10, its parent company said Tuesday.
About 2,800 employees would lose their jobs if the property closes.
Efforts to salvage the floundering megaresort, which filed for bankruptcy protection in June, have been unable “to put the property on a stable financial footing,” the company said in a statement.
“While we continue to hope for a sale of Revel, in some form, through the pending bankruptcy process, Revel cannot avoid an orderly wind-down of the business at this time,” the company said, noting it will honor deposits and reservations while the casino-hotel is open.
The nightmare scenario, in which a cascade of casino closings spikes the city’s unemployment rate from 13.1 to nearly 20 percent, is now close to becoming reality.
Mayor Don Guardian said in a statement Tuesday that he “remains committed” to the affected workers.
“This might be Revel’s last chapter, but not the last one for this building,” he said.
That building, with its 47-story tower of shimmering glass, sits on a rather isolated patch near the north end of the Boardwalk. Its neighbor, the Mardi Gras-themed Showboat Casino Hotel, is set to close Aug. 31, taking about 2,100 jobs with it. Trump Plaza Hotel and Casino, where about 1,000 employees work at the Boardwalk’s midsection, is slated to shutter in mid-September.
Together, the three properties employ nearly 20 percent of the work force for Atlantic City casinos.
Vin Narayanan, editor-in-chief of the casino-trade publisher Casino City, said Tuesday’s announcement took many industry observers by surprise.
“The fact that Revel was unable to find a buyer is just absolutely shocking,” he said. “We expected Showboat was going to close. We expected Trump Plaza was going to close. But Revel, I think everyone assumed, was going to stay open.”
Revel hasn’t turned a profit since opening to huge fanfare in April 2012.
What went wrong?
Analysts cite a raft of reasons to explain how Revel, once thought to be the Boardwalk’s best and brightest, became perhaps the greatest failure in the history of Atlantic City casinos.
Its management was inept, its market was saturated and its architectural design was clumsy, they say. And then there was the crippling debt.
When Revel opened, Wall Street analysts predicted it would strain under more than a billion dollars of debt it racked up during construction. But Revel executives insisted the sheer grandeur of the 6.2 million-square-foot facility would attract the throngs of visitors needed to make the $2.4 billion project viable.
That didn’t happen.
Tepid revenue coupled with crushing debt caused huge losses. By March 2013, Revel was bankrupt.
It emerged from bankruptcy two months later, having shed much of its debt by selling lenders a huge stake in the operation.
By the end of 2013, the posh casino hotel, initially billed as a glitzy resort with upscale restaurants run by Iron Chefs, was marketing itself as an affordable venue with low-cost food options, such as a $9.99 steak-and-shrimp special.
But to no avail.
This June, hemorrhaging money, Revel again filed for bankruptcy protection, warning workers it could be shuttered by summer’s end if it didn’t find someone to buy it quickly.
An Aug. 4 deadline for bids on Revel came and went without public notice of whether bona fide suitors for the tanking property had emerged.
A private auction scheduled for Aug. 7 at the New York offices of Revel’s attorneys was postponed until this Thursday.
Then came Tuesday’s announcement.
At the entrance to The Row, Revel’s high-end shopping wing, Casmir Azubuike, a security guard at Revel since it opened, said Tuesday that he and his fellow workers are “heartbroken.”
“I love this place. I love this place,” he said. “It’s one of the best places to be,” the 28-year-old Sicklerville resident said as a visitor asked him for directions to Ovation Hall, the property’s 5,500-seat theater.
Downstairs, at Revel’s Boardwalk entrance, Carolyn Simmons, 69, was incredulous.
“I really don’t believe it’s going to close,” said Simmons, who traveled from Florida to stay at the hotel with a friend.
The friend, Calvin Glover, 70, said they booked a room at Revel based on a friend’s recommendation.
“He wanted us to have the best, so this is where he told us to come.”
Staff Writer Derek Harper contributed to this report.
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