Carl Icahn, the billionaire who bought the casino for $100 million in bankruptcy proceedings 18 months ago, is now shutting it down. Atlantic City used to be a vacation hotspot and the East Coast’s answer to Las Vegas.
Now that the Trump Taj Mahal casino has closed, the city has lost another of its symbols.
According to Germany’s Handelsblatt newspaper, even Wall Street legend, Carl Icahn lost millions here.
Atlantic City appears to be a phantom.
All you see three hours south of New York are trees and small towns. Skyscrapers appear in the distance, seemingly out of nowhere, and the blue sea seems behind them. It’s just as surreal to walk around the city. The Boardwalk, as it is known, is boarded up, with ice cream and cotton candy stands strewn about.
A steel pier cuts into the ocean a short distance away, where a few vacationers are sunbathing on the beach. Cowboys used to entertain guests by jumping their horses into the ocean from the pier.
Only a massive Ferris wheel and a speeding train are visible now.
The Trump Taj Mahal, the city’s largest casino, rises in the heart of town, looking like it belongs in Las Vegas. It resembles India’s famous mausoleum with its concrete domes and minarets. Still, it bears little resemblance to the remembrance of a deceased loved one – inside, pensioners and tourists crowd into a dingy gambling parlor in front of one-armed bandits (slot machines – ed.). The games will take place until September 6, when the Trump Taj Mahal will close its doors. Nearly a third of the workforce has been on strike since early July, demanding higher pay.
“We cannot continue to lose tens of millions when unions block the path to higher profitability,” said Tony Rodio, president of company operator Tropicana Entertainment, in a statement. Carl Icahn, a hedge fund manager, owns the Tropicana Entertainment holding company, which he purchased for $100 million in bankruptcy proceedings 18 months ago.
The billionaire lost that money. He says of his investment, “It was a bad bet.” He’s now yanking the plug.
The issue of pay is at the heart of the conflict with the unions.
Employees at the casino earn an hourly wage of $12, which is lower than at other casinos in the city. During the bankruptcy proceedings, they also lost their employer-provided health insurance and other benefits.
“I would have made peace with the employees for several million dollars. The big businessman would burn down the casino rather than share the ashes with anyone else, “Bob McDevitt, a union leader, said of Icahn.
Donald Trump, the Republican presidential candidate, has had nothing to do with the Trump Taj Mahal for a long time. He built this gambling temple in 1990, had significant problems for a long time, and went bankrupt several times.
After the bankruptcy in 2009, Trump was left with only 10% of the company, which he lost again in the 2014 crash. The New York businessman then tried to persuade the court to remove his name from the casino’s name.
It was all in vain.
Icahn would rather give up the name of his own volition. Americans have avoided Trump’s businesses like hotels, golf clubs, and casinos since he ran for president, according to the Foursquare app; since June 2015, the number of visitors has dropped by an average of 27%. It is undeniable that Atlantic City is in severe financial trouble. The golden age depicted in the “Boardwalk Empire” series has passed.
The city used to have a monopoly, but that is no longer the case. Many new casinos have opened in the area, including those near horse racing tracks, and on Indian reservations. Furthermore, gambling is becoming legal in more states, and Americans are no longer betting on roulette or blackjack. Most of them now looking for fast payout online casinos.
Atlantic City was known as the East Coast’s version of Las Vegas for a long time.
However, the differences are apparent: while the weather in Las Vegas is pleasant almost all year, it is only warm for three to four months in Atlantic City. There are no international visitors and only a few direct flights from abroad. Almost all of the 27 million annual visitors arrive by car, and visitor numbers have been declining for the past eight years. Americans now prefer to go to casinos that are close to their homes to avoid having to travel long distances.
As a result, the city’s annual gambling revenue has dropped by half to $2.6 billion in the last nine years.