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Gaming in Atlantic City..............
A History of Legal Gambling in New Jersey -
Part Five -- By Stephen Piccolo
The third casino to open in Atlantic City in 1980 was the Golden Nugget. In June of 1978, Steve Wynn was at Resorts International marveling at the amount of money being gambled and at the overflow crowds being drawn by Resorts. It was then that Resorts president Jack Davis suggested that Wynn travel to the other end of the boardwalk to the Strand Motel to speak with the owner, Manny Soloman about a purchase. Twenty-five minutes later Wynn walked out, having agreed to pay $8.5 million in cash for what would end up being his casino site. Within sixteen months, a 22 story - 506 room hotel, 40,805 sq.ft. casino, a 500 seat theater and a 500 car parking garage were erected at the then bargain price of $160 million. How Steve Wynn got to this point is the kind of stuff dreams are made of.
Wynn bought a 3% interest in the New Frontier hotel in Las Vegas for $30,000 in 1965. In 1966, he moved his family to Vegas and became a slot machine supervisor and assistant credit manager at the Frontier. In 1967, Wynn was befriended by E. Parry Thomas, the most powerful banker in Nevada. Thomas personally made sure Wynn re-couped his $30,000 investment when the Frontier was sold. Besides, it was Howard Hughes who was buying the Frontier for $23 million and the transaction was being handled by none other than E. Parry Thomas! Wynn’s next casino deal was for a strip of land that Thomas came up with that Caesars Palace had leased from Hughes as an addition to its parking lot. Caesars had been trying to buy the land from Hughes to no avail. Thomas steered Wynn to the purchase for $1.1 million. Thomas loaned Wynn $1.2 million with the extra $100,000 to cover interest till he could strike a deal with Caesars. Caesars offered Wynn a quick $250,000 profit, which he promptly refused. Wynn told Caesars he was thinking of building a small casino on the property. Wynn’s price was $2.25 million and since Caesars did not want another casino built next to them, they paid it. Funny thing that some twenty odd years later Wynn DID become Caesars neighbor! Wynn made a cool $1 million on an investment that cost him nothing! Wynn then started buying stock in Golden Nugget in 1969. By 1973, he had bought 912,600 shares and received a gaming license in Nevada. After purchasing another block of stock, Wynn was elected to the board of the Golden Nugget and named executive vice-president of the casino. By August of 1973, Wynn was in full control of the company. With another Thomas loan, he built a 579 room hotel tower and garage and was on his way!
The Atlantic City Golden Nugget was granted a temporary license on November 21, 1980 and opened on December 9, 1980. Their permanent license was granted on November 13, 1981 and for the first six months of that year reported $17.7 million in profits, which was more than the other seven casinos operating at the time...................COMBINED!! The Golden Nugget was the top drawing casino on the boardwalk. The Golden Nugget also owned land in the marina section and plans were on the drawing board for another casino projected to cost $250 million. These plans were set aside as Wynn soured on Atlantic City. The strict regulatory rules in New Jersey always aggravated Wynn who let it be known that these “rules” were not allowing the gaming business to reach its full potential in Atlantic City. Unable to change these rules, Wynn sold the Atlantic City Golden Nugget to Bally’s in 1986 who renamed it Bally’s Grand.
The price Bally’s paid was over $400 million. Much of this was used to finance the Mirage in Las Vegas. At the time of the sale, Wynn vowed never to return to Atlantic City even if he were “given a casino.” Those words changed drastically in 1996. As Bally’s Grand, the casino went through some lean times. At the time the property was purchased by Bally, the consensus was that they overpaid. Ground was recently broke for an additional tower to add 300 rooms to the property and more public space. With the recent sale of Bally to Hilton, rumor has it that the name of Bally Grand may be dropped to get the Hilton name in Atlantic City. Did I hear someone mention Flamingo...........???
Casino number seven in Atlantic City was the ill-fated Playboy Hotel & Casino. The casino was owned by Hugh Hefner’s Playboy Enterprises and the Elsinore Corporation. Built on a postage stamp size of real estate on Florida Avenue and the boardwalk the unique three-level casino with the minimum 500 room hotel opened on April 14, 1981. The three level design did not go over too well as most gamblers disliked it. Each of the three floors were long and narrow making it difficult for an “even flow” to the casino. Hefner and Playboy were not granted a license and the casino was run by their partner - Elsinore Corporation. The casino retained the bunny dealers and cocktail waitresses and still operated as Playboy till April of 1984. After two years of appeals, Playboy Enterprises gave up on its effort to become licensed and sold its 45.7% interest in the casino to Elsinore. In June of 1984, after weeks of work by Elsinore crews removing the bunny logo from every nook and cranny of the hotel and casino, the huge Playboy sign atop the hotel was lowered and up went the new one - Atlantis! Elsinore continued to run the hotel - this time under the Atlantis name for five more years, unprofitable ones at that. In April of 1989, the Casino Control Commission refused to renew the license for the Atlantis and placed the property under the control of a conservator. The following month, the casino at the Atlantis was closed. It was the first casino in Atlantic City to fail. In June of 1989, Donald Trump took over the Atlantis as a non-casino hotel and re-named it Trump Regency. At the time, Trump already owned three casinos in Atlantic City, the legal limit in 1989. In 1996, the casino at the Trump Regency was re-opened under the name Trump Worlds Fair Casino. Earlier, the law limiting the number of casinos owned by one individual/corporation to three was abolished. Even though, Trump is operating this casino as an “arm” of his Trump Plaza casino.
The narrow three-level design of the Playboy/Atlantis was never embraced by gamblers in Atlantic City and probably led to its’ demise. Maybe under the Trump name and open as only a part of a much larger complex, the property may be able to hold its own in the highly competitive Atlantic City market.
Next issue will look at the Claridge and Tropicana casinos, the last two of what is considered the first wave of casinos in Atlantic City.