Revel secures financing to resume casino work

Posted: February 18, 2011

ATLANTIC CITY - Revel Entertainment Group L.L.C. closed on $1.15 billion in financing Thursday with a consortium of banks, the final piece needed to resume work on its partially built $2.5 billion Boardwalk casino.

"Construction will resume immediately, putting over 2,000 back to work . . . 5,500 full-time employees when we open," Revel chief executive officer Kevin DeSanctis said in an interview after the deal closed Thursday afternoon, with J.P. Morgan Chase & Co. as the lead arranger and Fox Rothschild L.L.P. as Revel's sole financial adviser.

DeSanctis said the casino was on track to open 15 months from now, in summer 2012.

"We're relieved. This is a big step," he said, "and we look forward to getting the project restarted."

The casino sits next to the Showboat on the northern end of the Boardwalk. All interior work came to a halt in January 2009, when money ran out and credit markets dried up. But some infrastructure work on the exterior continued, with the structure and enclosure completed in August.

On Feb. 1, Gov. Christie visited the Revel site to announce that the state was pumping $261 million in tax credits toward the project's completion. The Republican governor is initiating a state-run overhaul of the resort city, from its marketing to increasing the powers of the Casino Reinvestment Development Authority.

Christie said Revel was a critical part of Atlantic City's revival and would make it more of an overnight destination, as opposed to a day-trip attraction.

"The Revel financing, along with the recent acquisitions of Resorts and Trump Marina, reveals surprising optimism in the A.C. market," gaming analyst John Kempf of RBC Capital Markets in New York said Thursday. "Yet revenues continue to decline. These astute investors see something in Atlantic City that the common gambler does not."

On Monday, Trump Entertainment Resorts Inc. announced that it had reached a deal with Landry's Inc. of Houston to sell Trump Marina for $38 million. In December, Resorts Casino, the oldest and one of the smallest gambling halls in Atlantic City, was sold to gaming-industry veteran Dennis Gomes for $31 million.

When its casino opens, Revel plans to have 12 restaurants, 1,100 hotel rooms, 75,000 square feet of retail space, a 22,000-square-foot spa, three pools, and two nightclubs. It will be the city's biggest casino, surpassing the $1.1 billion Borgata - the last megaresort to open there, in July 2003.

A summer analysis by Spectrum Gaming Group L.L.C. of Linwood, N.J., estimated that once fully built, Revel could generate about $40 million in annual property-tax revenue for Atlantic City.

The Shore resort has struggled against new competition. Since the first casino opened in Pennsylvania in late 2006, the 11 Atlantic City gambling halls have lost more than $1.6 billion in revenue and shed about 7,500 employees.


Contact staff writer Suzette Parmley at 215-854-2594 or sparmley@phillynews.com.

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