Atlantic City land sale reflects hard times

Posted: March 10, 2013

Land is dirt-cheap in Atlantic City, just like some of its aging casinos.

Gaming insiders say Pinnacle Entertainment Inc.'s deal to sell land it has owned at the resort since 2006 for $30.6 million underscores the painful fact that things have drastically changed - and not for the better.

Las Vegas-based Pinnacle Enpaid $270 million for the 19 acres at the heart of the Boardwalk district, site of the former Sands Casino Hotel. Pinnacle imploded the Sands in 2007 to make way for a $1.5 billion megacasino, but scrapped those plans as the economy and Atlantic City gambling revenue tanked. It put the land up for sale in 2010.

In a filing Thursday with the Securities and Exchange Commission, the company acknowledged that it had a buyer, but did not disclose the name.

The $30.6 million sale price is in line with what smaller and older Atlantic City casinos have fetched in the last two years.

The former Trump Marina, rebranded the Golden Nugget Atlantic City Hotel & Casino, sold for $38 million in early 2011 to Landry's Inc. Resorts - and was resold in December of that year to Morris Bailey and the late Dennis Gomes for $31.5 million.

Trump Plaza announced last month that it was sold to Meruelo Gaming Holdings L.L.C. for $20 million. The sale is expected to close by May 31.

"It's a challenging market to profitably operate a casino," gaming analyst John Kempf of RBC Capital Markets L.L.C. said, "especially if you have a location disadvantage, or lack scale and amenities.

"There is just too much supply to efficiently serve the market."

Kerry Andersen, spokesperson for Pinnacle, said the company had nothing to add on the sale, expected to close by the end of the month.

The company said it all in its filing: "We have reflected our Atlantic City operations as discontinued operations and the related assets and liabilities as held for sale."


Contact Suzette Parmley

at 215-854-2855 or sparmley@phillynews.com.

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