Revel more viable as a mixed-use commercial space, say experts

With Atlantic City’s Revel Casino Hotel not turning a profit as a casino hotel since it opened in April 2012, experts say the property could have more viability as a mixed-use commercial space.

“I look at that structure as one of the most spectacular structures that have been built on the East Coast in the last [few] decades,” said Israel Posner, executive director of the Lloyd D. Levenson Institute of Gaming Hospitality & Tourism at the Richard Stockton College of New Jersey. “I can’t imagine a more modern and sophisticated structure anywhere that is comparable in terms of its potential. Regardless of whether it operates as a casino or not, as a structure, it has tremendous hidden value.”

The $2.4 billion facility is currently set to cease operations on Sept. 10 after being unable to find a qualified buyer. And, while its future is still a big question mark, experts already have a few ideas on what the building could or should become in order to be more profitable.

"I don't think of it as being limited to the vision of [just] a hotel, casino or resort. "Posner said. "It can be that, and is that, but its potential use is much broader than that ... It's simply looking at it without the blinders on as a hotel and resort."

Posner suggested the 6.3-million-square-foot, 47-story structure be used as a mixed-use commercial property — something akin to a structure you'd find in New York or Chicago.

"Imagine being able to live above the office where you work," Posner said. "It's like living on a main street where your apartment is upstairs."

Posner said to think of the structure as an office tower. The Revel was designed to have two towers with 3,800 rooms. It was left unfinished, however, so the public areas only had 1,400 rooms supporting them, making it always look somewhat empty — and that doesn't appeal to gamblers or patrons.

Future as a Casino?

The structure can still find a new lease on life as a casino, but it'll take a buyer who's willing to invest heavily.

"I would rather see it stay open as a casino," said Alan Woinski, president of Gambing USA Corp., a consulting firm in Paramus, N.J. "Buy it for peanuts, sink $100 million to fix the glaring problems, and [have] somebody who knows how to run a casino, can attract customers and operate it that way."

As for who that somebody could be, Posner said it would need to be someone who can capitalize on the structure's potential as a casino resort.

"Probably, you'll look to a company that has deep pockets and a "blackbook" (a customer base) — a traditional casino company, and not necessarily one that is America-based. It could be a new company that wants to get into the business. It could be foreign," Posner said.

Posner also said: "It could be someone that looks at it from a perspective of a modern, first-class casino resort. Many people believe it would have to have capital expenditures to change some of the internal structure to be consistent [with its brand.]"

What Went Wrong in the First Place?

Some experts say Revel's troubles started from the get-go — its design. Structurally, Revel stood out as a casino because of the layout of its internal design, focusing on the non-gaming aspect.

“As a casino, it’s non-standard and not typical if you approach it as a gambling or casino customer,” Posner said. “There’s a certain similarity in how casinos are structured, and what Revel did was break that mold because they were not going for a gambling joint — they were going for the high-end resort concept.”

The layout was criticized because gamblers had to walk a long distance or ride up very tall escalators just to get to the casino, the Wall Street Journal reports. This focus on being a high-end resort may have contributed to its failure, experts say.

“The problem with Revel was not that they didn’t attract business, it was just a horrible set up [with] bad service, and a bad location that they couldn’t keep anybody in there,” Woinski said. “Everyone I know has gone to Revel, but nobody ever gambled or stayed because it was a horrible experience.”

In fact, the troubled casino wasn’t even marketed as a casino. It was marketed as a “lifestyle resort with a casino,” Revel spokeswoman Lisa Johnson told the Press of Atlantic City back in 2011, leaving gamblers feeling isolated.

“Look at the overall design of the Borgata [which is turning in a profit]. It’s warm, inviting and easy to navigate, said Saverio R. Scheri III, president and chief executive of WhiteSand Gaming LLC, a consulting firm with offices in Atlantic City. “Revel is cold, modern-feeling and difficult to navigate, even on the casino floor.”

Scheri also said: “It’s aesthetically pleasing, but they’ve created an environment gamblers don’t feel comfortable in.”

Source: Philadelphia Business Journal