New Entry Heats Up Atlantic City Rivalry

Atlantic City in July saw the opening of its first new hotel/casino in more than a decade, but the competition to fill beds could heat up as a slew of rival properties continues moving forward with respective improvement projects.

The new Borgata Hotel Casino & Spa features 2,000-plus guest rooms and suites, 11 restaurants and a 50,000-sq.-ft. European-style spa. The $1 billion hotel offers 70,000 square feet of meeting space, a 1,000-seat theater, high-speed Internet access for conventioneers and express group checkout.

The 40-story-high Borgata, a joint venture between Boyd Gaming Corp. and MGM Mirage, has a variety of guest rooms and suites, all of which feature floor-to-ceiling windows and high-speed Internet access. Classic rooms have marbled bathrooms with showers for two; fiore suites have natural wood foyers and deep soaking baths/showers for two; 900-sq.-ft. studio suites offer 42-inch plasma television screens and wet bars; and the 1,000-sq.-ft. opus suites are a larger version of the fiore suites. The hotel's piatto suites, at 1,500 square feet, offer all of the aforementioned, plus a multi-media entertainment center. The Borgata also has 5,000-sq.-ft. residences, with 60-inch plasma TV screens, wet bars, exercise room/spas and dining rooms that seat 12.

"The initial reactions from customers have been overwhelmingly positive," said William Boyd, chairman and CEO of Boyd Gaming Corp., in a company statement in late July. "Customer intent to return, as measured during intercept surveys, is strong and has exceeded our expectations. Our customer database is growing at an excellent pace and ahead of plan."

Meanwhile, other properties in the area are trying to keep up, with many tearing down the old and building anew.

"The Borgata has affected virtually every property in some way or another," said Susan Kotzen, spokesperson for Harrah's and Showboat. "They've grown the market slightly—maybe not as much as everyone might have hoped—and they've taken their share of the market as well. Yet, that's something everyone realized would happen. Overall, the industry was excited about the Borgata because it was something new and different. It has brought people who have never visited Atlantic City, as well as people who haven't been here during the past two or three years who have not seen all the changes that have taken place. So, it's been a welcome addition to the industry and can only help to enhance our market overall."

With the May 2002 opening of its 25-story Bayview Tower, Harrah's Atlantic City features a total of 1,626 hotel rooms and suites. The 452-room tower at Harrah's includes 36 suites on the 22nd through 24th floors and eight super suites on the 25th floor. Harrah's has a new grand lobby, replete with imported Italian marble, Art Deco columns, brass outlays and a stained glass dome. Additionally, the hotel—which invested more than $200 million in its expansion and upgrade—in May of this year opened the Eden lounge.

Harrah's sister property, Showboat The Mardi Gras Casino, in May opened a 19-story tower with 544 rooms, bringing to 1,370 the number of total rooms and suites. Two new restaurants also opened in May: the Delta Bar & Grille sports bar and the Rib & Chophouse gourmet steakhouse.

"Occupancy has been virtually sold out every evening throughout the entire summer," Kotzen said. "The additional room inventory we brought online has really helped us accommodate customers that we've had to shut out in the past."

In 2002, conventions and tradeshows generated approximately $442.2 million for Atlantic City, a 21.6 percent increase from 2001.

"In a year when tourism and convention attendance decreased in many major markets, figures in Atlantic City are a testament to our convenient location, as well as to the many fine venues we offer," said Jeffrey Vasser, executive director of the Atlantic City Convention & Visitors Authority. "We're looking forward to maintaining that upward trend as we continue to grow and improve."

Prior to the Borgata, the last new property that opened in the market—in 1990—was the Trump Taj Mahal, which just wrapped up a $15 million renovation to its guest rooms, suites, club restaurants and member services area, restyling guest rooms with an animal motif and adding gas fireplaces, in-room jacuzzis and televisions that elevate from the foot of the bed in luxury rooms.

The Tropicana Casino & Resort presently is working on a $225 million expansion, known as The Quarter. The project includes a 31-story, 502-room hotel tower, a 220,000-sq.-ft. retail, dining and entertainment complex and a 25-room conference center. The Havana Tower, which will bring to 2,127 the total number of rooms Tropicana will offer, is scheduled for completion March 1, 2004. Its top floor will include four boardrooms with "state-of-the-art technological capabilities" and four convention and hospitality suites with floor- to-ceiling windows.

Resorts Atlantic City is replacing its old North Tower, which had 166 rooms, with a larger tower scheduled to open in spring 2004. "We're in the process of building the 27-story tower, which will have 459 rooms with 51 deluxe suites," said Diane Spiers, Resorts spokesperson. Asked how construction has impacted guests, Spiers said that "because it's in a separate part of the building, it's very quiet so there's no disruption at all. Occupancy has been great."

According to the property, the hotel rooms will be approximately 100 square feet larger than those in any of the other casino properties, making Resorts' standard hotel rooms the largest in the city. Each room will have oversize bathrooms with imported marble, showers for two, double vanities and makeup tables. The new Art Deco-style tower cost an estimated $125 million.