Typically, the third time’s the charm. However, this hasn’t been the case of Ocean Resort Casino in Atlantic City, which has already gone through three owners and has never been able to produce the level of profit any had expected. Perhaps the fourth time’s the charm, as Luxor Capital Group has been given approval for its interim license to run the casino while New Jersey regulators discuss issuing permanent authorization.
Luxor purchased the fledgling property, previously known as Ocean Walk, this past January. The casino was coming off a disastrous five-month run that saw it lose $22.7 million, and an even longer run as the gambling city’s biggest long-term loser. It had been put through bankruptcy twice in two years after it opened in 2012 and was purchased at a bankruptcy auction in 2015. It stayed closed until January of last year before renovations began toward a summer opening, and still has never been able to find its footing.
Luxor believes it has the expertise to turn things around and submitted company executives to an all-day grilling in front of the public last week to prove its point. The New Jersey Division of Gaming Enforcement and the Casino Control Commission (CCC) are ready to give the company a chance to do what no one else has been able to do – turn the $2.4-billion resort into a money-maker.
Luxor is a hedge fund out of New York and its interim license will give it the ability to start ramping up operations at the casino while regulators dig deeper into the company to determine whether or not a permanent license should be granted. The CCC wants to ensure that Luxor has the financial capability to keep the venue open for more than just a few months, as has typically been the case since it was first introduced.
The hedge fund has already sunk over $70 million into the resort. The majority of this was a debt of $50 million owed to J.P. Morgan and, since that time, Ocean has begun to see some vital signs. This past June, it reported gaming revenue of almost $21.5 million – the highest it has ever been. It also saw the highest hotel occupancy on record.
To help it get the casino going again, Luxor tapped Gary Van Hettinga as a trustee to help oversee operations. A permanent CEO is still needed, but Van Hettinga has been involved in the highest levels of operations at companies like Caesars World, Tropicana Atlantic City, Mohegan Sun and Resorts Casino Hotel, giving him a great deal of experience that appears to be paying off for Ocean.