ToCasino.net Online Casino

ATLANTIC CITY—Much of Atlantic City's bid to remake itself as more than a casino town was reflected in the Revel Casino Hotel, a glassy $2.4 billion skyscraper that opened in 2012—hailed by Gov. Chris Christie and local officials as a game-changer.

Targeting an affluent crowd, Revel owners decided not to offer the standard, all-you-can-eat buffet and loaded up the property with luxury amenities like free, in-room tablet computers and cavernous walk-in showers. To lure younger patrons, they attracted high-end boutiques, restaurants and night clubs.

Now, the 1,400-room property has filed for bankruptcy protection for a second time in nearly 15 months and is expected to close if a buyer isn't found. Revel's gambling revenues have regularly ranked near the bottom among Atlantic City casinos, according to state reports.

Casino analysts are laying odds on whether anyone will bite.

"I'd put it at 50-50," said Joseph Weinert, senior vice president of the Spectrum Gaming Group, an industry consultancy.

That Atlantic City's tallest, shiniest and newest property might go dark is the sharpest blow yet to Mr. Christie's optimistic five-year plan to address the city's ills. The news, along with the expected closing of the Showboat Casino, has roiled the city.

"This was supposed to be a new paradigm, a new kind of place," said John Palmieri, executive director of the Casino Reinvestment Development Authority, appointed by Mr. Christie. "Some very smart people who made investment decisions believed that it could succeed."

Liditze Diaz, a 20-year-old waitress at a restaurant inside Revel, said "there is a lot of fear" along the city's boardwalk.

"I've been here my whole life," said Ms. Diaz. "I can tell it's just not the same. Atlantic City used to be the place to be. It was very full. It was very lively."

The Revel never saw such a heyday.

Weighed down by heavy debt and an increasingly saturated market, the casino never turned an annual profit, according to filings with the state.

After running an operating loss of $185.4 million in 2013, the company lost $29 million from operations in the first quarter of 2014, down from $60.6 million in the year-earlier quarter.

Casino officials declined to comment for this article, but the company's bankruptcy filing pinned the financial failure, in part, on construction overruns and expensive bills—particularly for power. The company pays more than $2 million a month above its electric bills because it hired an outside firm to build it a separate power plant.

Then, there was the new casino's problem of attracting gamblers.

Unlike competitors such as Harrah's CZR -1.44% Caesars Entertainment Corp. U.S.: Nasdaq ^$17.10 -0.25 -1.44% July 10, 2014 4:00 pm Volume (Delayed 15m) : 453,914 AFTER HOURS ^$17.10 0.00 0.00% July 10, 2014 4:22 pm Volume (Delayed 15m): 3,504 P/E Ratio N/A Market Cap $2.50 Billion Dividend Yield N/A Rev. per Employee $125,263 07/10/14 Revel Casino, Still Shiny and ... 06/30/14 Total of 17 Bids Submitted for... 06/27/14 Atlantic City's Blues Play On;... More quote details and news » CZR in Your Value Your Change Short position Resort Atlantic City, the Revel had no established customer base with a larger casino alliance to tap into. On a recent weeknight, its casino appeared far less bustling than others nearby, with rows of empty slot machines and tables. Two casino attendants said that, apart from weekends, such attendance was typical this summer.

In some months, it attracted one-fifth the gambling money that the city's Borgata Hotel Casino & Spa did."There wasn't a seven-day-a-week business model," said one former high-ranking Revel executive. "You built this phenomenal South Beach structure, and you needed a casino to support it."

For many patrons, the building design was also confusing, since the lobby sits several floors from the ground floor and getting to the casino involves a long walk and escalator ride from the guest rooms.

It seemed "they almost didn't want you to get to the casino," said Andrew Zarnett, a gaming analyst for Deutsche Bank. DBK.XE -2.00% Deutsche Bank AG Germany: Xetra ^€25.50 -0.52 -2.00% July 10, 2014 5:35 pm Volume (Delayed 15m) : 13.13M P/E Ratio 534.70 Market Cap €35.90 Billion Dividend Yield 2.94% Rev. per Employee €419,861 07/10/14 Revel Casino, Still Shiny and ... 07/10/14 Deutsche Media Analyst Jumps t... 07/10/14 HEARD ON THE STREET: Banco Esp... More quote details and news » DBK.XE in Your Value Your Change Short position

"People would come into the restaurant, but the casino would be empty," Ms. Diaz, the waitress, said. "They always tell me how beautiful the place is."

The Revel also had to compete with the Borgata, the city's most successful hotel—one that had already cornered much of the luxury, nongambling market with its penthouse suites and high-floor spa facilities.

Yet, for all its posh trappings, said Joe Lupo, a Borgata senior vice president, pointing to an all-you-can-eat buffet, "we didn't forget who we were."

Fixing Atlantic City's woes was a priority for Mr. Christie, who issued a five-year plan in 2011 that promised $30 million in annual marketing dollars and extra help keeping the city safe.

The plan advanced several goals: to bring more flights into the city's airport, lure more convention business, raise private investment and largely bring the city's economy into a post-gambling world, as revenues continue to decline. The Revel was to be a prominent part of the mix, opening in 2012 to much acclaim and with the promise of tax credits.

While optimistic about the city's future, Atlantic City Mayor Don Guardian expects the loss of 5,000 more casino jobs and the city to continue needing state help.

Some analysts say more properties will need to close to right-size the market, as Atlantic City contends with growing competition from nearby states. Recently, lawmakers floated the idea of building casinos in northern New Jersey.

At its peak in 2006, city gambling revenue rose to $5.2 billion, according to state reports. It was $2.86 billion last year.

Jon Hanson, a real-estate developer who helped create the governor's plan, said progress has been made in attracting nongaming amenities.

He cited a Bass Pro Shops store under construction and a Jimmy Buffett's Margaritaville restaurant that opened last year. The city has staged some successful events, from country concerts to wine tastings.

"The non-gaming venues are going to be the end results of what we recommended and the stronger casinos will be the ones that survive," Mr. Hanson said.

Convention business has picked up by more than 10% since 2011, according to Mr. Palmieri's group. Harrah's is building a convention center, with help from casino tax dollars but more inbound flights are needed, said Mr. Palmieri.

United Airlines recently announced it would fly into Atlantic City from two cities, but no international flights or other options exist, beyond some on Spirit Airlines. SAVE +1.26% Spirit Airlines Inc. U.S.: Nasdaq ^$64.32 +0.80 +1.26% July 10, 2014 4:00 pm Volume (Delayed 15m) : 828,853 AFTER HOURS ^$64.32 0.00 0.00% July 10, 2014 4:22 pm Volume (Delayed 15m): 9,248 P/E Ratio 25.42 Market Cap $4.62 Billion Dividend Yield N/A Rev. per Employee $534,099 07/10/14 Revel Casino, Still Shiny and ... 05/21/14 U.S. Government Proposes Requi... 05/12/14 JetBlue CEO in Hot Seat as Air... More quote details and news » SAVE in Your Value Your Change Short position

Then, there are the ramshackle motels and run-down shops not far from the casinos.

"Have we taken all the poverty off the streets or taken the blight away?" Mr. Palmieri said. "Absolutely not. But we've made progress."

Mr. Guardian, the mayor, said the city "kind of drank the Kool-Aid" on Revel. Now that the casino is back on the market, he said he thinks it will sell for less than $200 million. Mr. Hanson, the Christie planner, said a new owner can make a go of it.

Write to Heather Haddon at This e-mail address is being protected from spambots. You need JavaScript enabled to view it