When Will The Taj Mahal Casino Closed
Beginning with the closure of the Atlantic Club in January 2014, Atlantic City has seen the fat trimmed from its casino industry. The city has gone from 12 casino properties to just seven, following today’s closure of the Trump Taj Mahal.
The closure of Trump Taj Mahal is hitting people differently than the other four casinos that closed over the course of 2014 — Atlantic Club, Showboat, Trump Plaza, and Revel — due to the iconic nature of “The Taj,” which will forever hold a place in gambling history.
The Taj becomes an icon
Despite its persistent financial troubles, The Taj was the gambling destination on the East Coast for over a decade.
The Trump Taj Mahal, once an east coast poker hotspot, is closing its doors for good after 26 years. An Atlantic City icon, the casino was originally founded by Resorts International in 1983. The Trump Taj Mahal will be closed after an announcement was released this week by the owners. Atlantic City has seen better days. Decades ago the town was always bustling with activity as individuals visited the many casinos in the area, enjoy games and entertainment.
On August 3, 2016, it was announced that the Trump Taj Mahal would close after Labor Day, because of casino workers on strike. It was closed on October 10, 2016. On March 1, 2017, the Seminole Tribe of Florida through its Hard Rock International brand, and the Morris and Jingoli families, announced its purchase of the facility and conversion to the Hard Rock Hotel and Casino brand. The owner of the struggling Trump Taj Mahal Casino Resort filed court papers on Friday saying it will close next month, making it the fifth of the city's 12 casinos to shut down this year.
Its place in the pantheon of gambling destinations shouldn’t be overly surprising considering it was the first billion-dollar casino on the East Coast, and the only billion-dollar casino in Atlantic City for over a decade. Borgata, opened over a decade later, and just barely eclipsed the cost of the Trump Taj Mahal, coming in at a final cost of $1.1 billion.
In effect, The Taj was a Las Vegas Strip casino in Atlantic City.
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The Taj poker room was the place to play poker, with poker players traveling from New York, Philadelphia, D.C. and Boston to grab a seat in the weekend games at The Taj. As popular as the poker room was, it was the movie Rounders that made The Taj poker room as well known in poker circles as the World Series of Poker, and really cemented its place in poker history.
The Taj tries to shoot the moon
As mentioned above, the beauty and impressiveness of the property hid Trump Taj Mahal’s big secret.
The casino was a financial disaster from the day it opened its doors in 1990, with only brief periods of prosperity in its two-and-a-half-decade history.
The Taj’s financial woes didn’t come about because the casino wasn’t busy, or because it was seen as lacking in any respect. The problem wasn’t execution; it was planning. The price tag to build it, and the interest rates on the bonds Donald Trump agreed to pay in order to get the necessary financing for the casino simply set the property up to fail. The Taj was doomed before it ever dealt a card or rolled a dice.
As Politifact has reported:
“He [Donald Trump] funded the construction of the $1 billion Trump Taj Mahal casino in Atlantic City, N.J., which opened in 1990, primarily with junk bonds at a whopping 14 percent interest. A year later, the casino was nearly $3 billion in debt, while Trump had racked up nearly $900 million in personal liabilities.”
In 1991, Trump Taj Mahal filed for the first of what would eventually be four bankruptcies:
- The second bankruptcy occurred in 2004 (Trump Hotels and Casinos Resorts);
- The third in 2009 (Trump Entertainment Resorts);
- The fourth in 2014 (Trump Entertainment Resorts).
Trump’s personal interest in the casino was reduced from 47 percent to 27 percent following the 2004 bankruptcy, and to just 10 percent following the 2009 bankruptcy. His name remained on the side of the building but Donald Trump had been ousted as the chairman and lost control of operations following the 2009 bankruptcy.
Carl Icahn took control of the casino this year, and promised a $100 million investment in the property that many thought would breathe new life into the once opulent casino that had fallen into an extreme state of disrepair.
Icahn had recently turned around the Tropicana in Atlantic City, but a labor dispute resulted in a month-long strike, and with North Jersey casinos at least a possibility, Icahn decided to pull the plug and cut his losses.
Closure of the Taj Mahal may not be the end
Atlantic City’s capacity to support 12 casino properties was an open question well before neighboring states got into the casino business.
Once casinos started popping up on all sides of New Jersey, the question being asked wasn’t if Atlantic City could support 12 casino properties. Rather, it was “how many casinos need to close in order for Atlantic City’s casino industry to right-size itself?”
The current number of operational casinos in Atlantic City is seven. Developer Glenn Straub is trying to reopen Revel (which has been rebranded to TEN), which would bring the number of operational casinos in Atlantic City back up to eight. That may or may not be a viable number.
Some analysts think the market could support as many as eight casinos depending on other circumstances in the city and beyond. Others feel the proper number is no more than five or six casino properties, and even less if casinos are built in the northern part of the state in the coming years.
What happens next?
What happens to these shuttered casino properties will dictate the future of the once popular resort town.
Showboat has been green-lighted to reopen as a non-gaming hotel. If Trump Plaza, Atlantic Club, and Trump Taj Mahal can be repurposed in somewhat similar ways, it could be a boon for the city and its remaining casinos, all of which have seen operating profits rise since the 2014 casino contraction.
There are any number of uses for these massive properties:
They could be:
- converted to housing;
- turned into a non-gaming entertainment complex;
- turned into shopping malls with retail and dining options.
The key is finding a way to repurpose these buildings so they’re not an eyesore on the Atlantic City skyline, or a depressing reminder of the city’s lost glory.
f11photo / Shutterstock.com
The Trump Taj Mahal in Atlantic City shut its doors Oct. 10, weeks away from the presidential election, reported The Associated Press.
The Taj Mahal had one of the more famous poker rooms for a number of years and was a favorite reference and inspiration for scenes in the film Rounders (Brian Koppleman said the scene where Matt Damon faces off with Johnny Chan was inspired by his stint in the WSOP against Phil Hellmuth).
“It was the place that you could go play without violating any laws and where, if you were someone who wanted to get better at poker and study the best players, you were there,” Koppelman said to The Associated Press. He created Showtime’s TV show, Billions with Rounders writing partner David Levien. “If you were someone who wanted to hustle people, you could go there and find tourists to hustle.”
The casino opened in 1990 after poker became legal in New Jersey. According to the Associated Press, it was made into a popular destination after the U.S. Poker Championship in 1996 where top players laid down $10,000, making it the first tournament on the East Coast to match the financial caliber of the World Series of Poker.
The opening of the Borgata Casino in 2003 began the downfall of the Taj poker room, with poker rooms in Connecticut (with Foxwoods Casino taking some of the New York market), Pennsylvania, Delaware and Maryland accounting for the rest of the poker room’s usual action.
After closing for renovations in February 2015, the Taj Mahal opened back up in May. Two months later, a worker’s strike appeared to be the last straw for the casino.
In the casino’s final days, the controller was Carl Icahn, who told CNN it was a “sad day for Atlantic City.” After being unable to make an agreement with the striking union workers, Icahn couldn’t afford to run the casino, and so 3,000 workers lost their jobs instead with its closure just before 6 a.m. on Oct. 10.
Despite our best efforts, which included losing almost $350 million over just a few short years, we were unable to save the Taj Mahal.
“Despite our best efforts, which included losing almost $350 million over just a few short years, we were unable to save the Taj Mahal,” Icahn said in a statement Monday. CNN reported that the union workers were able to make deals with four other casinos in the city, including another that Icahn owned.
Donald Trump stepped down as chief executive officer over a decade ago, unloading the 17-acre (and over $1 billion to build) casino in 2009, according to Vanity Fair. He sued his own company to take his name off the casinos because the casinos did not meet his reputation and had fallen into a poorer conditions than he would have liked.
According to CNN, five other casinos have closed in Atlantic City since 2014, including Trump Plaza. Seven remain but two have filed for Chapter 11 bankruptcy protection: Bally’s and Caesar’s. These closures have by and large been called Atlantic City’s casino crisis by AP. Icahn decided Aug. 3 to close down the casino after realizing it could bleed $100 million in the next year.
Trump Taj Mahal was not without its struggles; it had financial problems almost since its inception, according to CNN’s analysis of Trump documents filed with the state gaming authorities.
The 1990 New Jersey Division of Gaming Enforcement report showed that Trump financed the casino with junk bonds (unable to cover payments with gaming operation profits), had less than $0 in its account four of the first 16 days of operation and had deep deficits reaching $1.7 million.
I have personally lived through Trump's economy. Mine was one of the middle-class jobs Trump created, then subsequently destroyed.
The Taj Mahal would file bankruptcy three times due to interest payments forcing them into the red (despite operating profit): in 1991, in 2004, in 2009, according to CNN. Initially in 1990, the state approved a $65 million bailout after the fear of closing was thought to potentially threaten the Atlantic City economy.
One of the casino’s former cocktail watresses, Valerie McMorris, was one of the 3,000 employees out of work (the casino’s total is 11,000 jobs lost to date). She worked for the casino for 26 years and is a Unite-HERE Local 54 union leader, who expressed to Refinery29 how initially the casino took care of its employees but over time it turned into a bait and switch.
“I'm remembering the excitement and anticipation of that 20-year-old girl, standing on that stage among hundreds of perfumed and decorated women,” she said to Refinery29. “We were promised decent jobs and golden futures. But in the past 26 years, I have personally lived through Trump's economy. Mine was one of the middle-class jobs Trump created, then subsequently destroyed.”
What Donald Trump once called the “eighth wonder of the world” is now something that he told AP shouldn’t have happened.
“I felt they should have been able to make a deal,” Trump said to The Associated Press in another story. “It's hard to believe they weren't able to make a deal.”
Once the casino closes, Trump told AP it’s too expensive to reopen. Many employees who decided to strike told AP that they did not regret their actions and that this instance should give Icahn pause in the future.
Taj Mahal Casino Wikipedia
Lead photo courtesy of Wikipedia.org
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Taj Mahal Closed Day
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