Resorts Atlantuc City forclosure

LunaToon · **LunaToon**

This a link to a Forbes story.............Resorts will either go into lorclosure or be forced to hand over the title. Colony Capital is the same ones that own Resorts Tunica. Wonder what this means for them?

http://www.forbes.com/feeds/ap/2009/01/22/ap5953581.html

Lender seeks takeover of Resorts Atlantic City
By WAYNE PARRY , 01.22.09, 03:40 PM EST

Saying that Resorts Atlantic City, New Jersey's first casino, hasn't made a loan payment since October and is in default, lender Column Financial filed a foreclosure petition Thursday.

Column Financial, a commercial mortgage subsidiary of Credit Suisse, asked the state's Casino Control Commission to let it foreclose on the casino.

Failing that, Column Financial wants the Colony Capital LLC affiliates that own the casino to hand over title to the property. Column would keep the casino open while searching for someone to run it.

"This is a sad, unfortunate consequence of the economy," said Joe Weinert, a casino analyst with Spectrum Gaming Group. "It could be the first of several casino failures across the country."

Weinert said Resorts' owners have not invested and upgraded the property on pace with the market.

"When you have that situation, piled on by the uncontrollable effects of the economy right now, that breaks the backs of the most vulnerable operators," the analyst said.

Revenue for casinos across the U.S. dropped $1.1 billion, or 3.6 percent, to $30.2 billion in the first 11 months of 2008 compared with the same period in 2007, according to the American Gaming Association.

In Atlantic City, revenue for all of 2008 declined 7.6 percent compared with 2007. Resorts' revenues were down more than 16 percent last year as it struggled to compete with bigger, newer casinos in a faltering market.

Los Angeles-based Colony Capital, which invests mainly in real estate, did not immediately return calls for comment Thursday. Colony's lawyer, Gil Brooks, declined comment.

A lawyer for Column, Paul O'Gara, also declined comment.

Resorts said in a filing with state regulators that it was unable to make its November payment on a $10 million loan that is backed by a $360 million mortgage on the property, "due to the extreme impact of the current economic conditions."

Resorts, which opened in May 1978, has 942 hotel rooms - less than half of what is now generally considered enough to compete in Atlantic City. The most successful casino-hotels, including the Borgata Hotel Casino & Spa and Harrah's Resort Atlantic City, have about 2,000 rooms each.

They also promote themselves as hip, cutting-edge destinations to stay for several days. The Borgata has celebrity restaurants and a luxurious new addition called The Water Club and often lands big concert and comedy acts. Harrah's has a huge indoor pool.

By contrast, Resorts caters to an older crowd, many of whom ride buses into town to gamble for a few hours, then go home. One of its main attractions is its nightclub, Boogie Nights, which features '70s disco music.

Resorts took in $233.2 million in 2008. The only Atlantic City casino that did worse last year was Trump Marina Hotel Casino, which is being sold. In contrast, the Borgata's revenues were $738.7 million, and Harrah's took in $544.7 million.

Also struggling in the nation's second-largest gambling market are the Tropicana Casino and Resort, which has been operating under a state conservator for more than a year, and the three Atlantic City casinos owned by Trump Entertainment Resorts, which got a two-week extension Wednesday on restructuring their debt.

But only one of Atlantic City's 11 casinos saw a bigger drop in revenue last year than Resorts - its sister property, the Atlantic City Hilton Casino Resort, where revenue was down 18.3 percent. The Hilton is not included in Column Financial's foreclosure action.

Copyright 2008 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed
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Brianzz · **Brianzz**

That means things are looking better and better for at least 1 less casino in Tunica
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It's better to be out playing the slots than sitting at home wondering if they're hitting.

WILynn · **WILynn**

All I have to say is hmmmmm. And hmmmm hmmmm hmmmm.
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LA · LA

And hmmmmmmm, again.
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Mphs Ed · **Mphs Ed**

I don't think that Atlantic City will have any direct impact on Resorts and Ballys here in Tunica. Even though they have Colony Capital in common, I don't think there are any direct financial ties.

To the best of my memory, CC has three different "groups" of casinos. Atlantic City, Tunica and another that has small casinos in Sparks and other NV towns.

The Resorts in Tunica is not expanding but it is not cutting back either. They are still hiring replacement personnel and making small changes. I can't see or hear of any major problems or fears. Still sending out mailers.

WILynn · **WILynn**

That's good to hear, Ed. I think almost all the casinos are having hard times now. The economy hasn't been kind to them, either. Time will tell which ones are able to float out the bad times and which ones will sink. I really hope it isn't any in Tunica, since they don't have enough competition between different owners as it is IMHO.

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