CEO will hit the Street for financing in Q4 to resume construction on Revel by Jan. A May 2011 opening is targeted which could provide a small shot in the arm for the slot makers but wreak further havoc on the AC operators.
CEO Kevin DeSanctis made public comments that indicate he will pursue the remaining Revel financing in Q4 for the Atlantic City hotel casino. If successful, construction would restart in January with a targeted opening in May 2011. Initial specs for Revel included 3,000 slot machines and 1,900 hotel rooms (with the potential for a second hotel tower coming online at a later date).
For the slot guys this is good news and part of the long-term bull market of new markets/casinos. 2011 should be the first year of significant growth in the new/expansion segment and probably the second year of an improving replacement cycle. While 3,000 slots is not overly significant in and of itself, there is a backlog of new casinos in AC and elsewhere that may be back on the front burner, particularly if Revel proves the financing markets are once again willing to fund new casino construction.
The existing casino operators in AC will talk a good game about new supply being a positive for the market, but given the wilting demand, they should be a little worried. Borgata may be at risk considering the likely price point similarities with Revel and a possible mini Boardwalk resurgence.
