Five of Atlantic City’s 12 casinos could close this year, following Trump Entertainment Resorts’ bankruptcy filing this past Tuesday.
The company owns Trump Plaza, a casino slated to close next week. Trump’s Taj Mahal could follow suit in November if the company cannot receive concessions from union workers.
According to paperwork filed with the U.S. Bankruptcy Court, Trump Entertainment estimates its liabilities range between $100 million and $500 million and assets no greater than $50,000. The company missed last quarter’s tax payment and currently does not have enough revenue to pay lenders this month, as reported by the Washington Post.
In a statement to the New York Times, Fitch Ratings analyst Alex Bumazhny indicates the Taj Mahal closure comes as a surprise: “The property is almost breaking even and will benefit from the closure of Trump Plaza.”
Three casinos have closed since January in lieu of increased competition from neighboring states. On CNBC’s “Closing Bell,” financial researcher Frank Fatini claims new casinos in Pennsylvania and New York state have “taken away…the convenience gambler, the ‘daytripper’”from Atlantic City.
Bloomberg states that higher labor costs and real estate taxes have also hurt Atlantic City’s profits.
The closing of the Taj Mahal could leave 2,800 workers unemployed, raising the year’s total loss in Atlantic City casino jobs to above 8,000.
On Monday, New Jersey governor Chris Christie assembled a meeting of elected officials, casino executive and union leaders to discuss Atlantic City uncertain future.
“A whole bunch [of] people are getting put out of work with nothing else on the horizon,” said state senator and former city mayor James Whelan. “You now have the possibility of five empty buildings on the boardwalk.”
Trump Entertainment has struggled since its 2010 bankruptcy. Billionaire investor Carl Icahn currently holds a $289 million loan, rendering him the company’s largest credited investor.
Donald J. Trump owns a 9 percent stake in the company but has no connection with operations. Trump has a current lawsuit to remove his name from the properties.