Sands Bethlehem impact not as bad as feared in AC

ATLANTIC CITY, N.J. — For months, Atlantic City has been dreading the opening of a new casino in Bethlehem, Pa., a short drive from some of its best markets in northern New Jersey and New York.

On Friday, when the nation’s second-largest gambling market got its first look at the impact of the Sands Bethlehem, the results were better than expected: Revenue at Atlantic City’s casinos fell 13.6 percent in June compared with a year ago.

It was the second-best month so far this year in terms of percentage decline.

Atlantic City was down 15.4 percent in May, 14.2 percent in April, more than 19 percent in March and February. January posted the best numbers with a 9.4 percent decline.

That had Dan Nita, Mid-Atlantic president of Harrah’s Entertainment Inc., predicting that Atlantic City’s declines may have stabilized.

In its first full month open, the Sands Bethlehem took in more than $19.6 million.

“Certainly a decent portion of that came from the traditional Atlantic City market,” said Matt Jacob, a casino analyst with Majestic Research. “Bethlehem is more convenient for a lot of Atlantic City’s traditional customers who live closer to it than to Atlantic City.

“The encouraging thing is that there have been bigger declines earlier this year,” he said. “It’s not like we’re seeing a 20 percent decline following the opening of Bethlehem.”

Jacob also said the Sands may be benefiting from the “honeymoon period” that new casinos enjoy when first-time customers go to check them out. It remains to be seen how many of them will return as regular customers, he added.

Atlantic City is in its third straight year of a revenue decline that began soon after the first Pennsylvania slots parlor opened in November 2006. Since then, other slots parlors in Pennsylvania and New York have further cut into Atlantic City’s market, and neighboring Delaware will soon start offering table games — one thing Atlantic City still has that its nearby competitors don’t.

In June, Atlantic City’s casinos took in $322.7 million. Slot machines brought in $227.5 million, a decline of 14.5 percent, while table games accounted for $95.3 million, down 11.3 percent.

For the first half of this year, casinos won $1.94 billion, down 15.3 percent from the same period last year.

Nita said it’s too soon to tell if Sands Bethlehem will have a major impact on Atlantic City. He said the company’s four Atlantic City casinos tracked their customers from northern New Jersey and New York and found no big decline in their visits or level of play last month.

In what is supposed to be one of the strongest months for Atlantic City casinos, all 11 casinos reported declines. The Atlantic City Hilton Casino resort did worst, down 24 percent, followed by Trump Marina Hotel Casino, down 20.8 percent.

The perennial market leader, the Borgata Hotel Casino & Spa, posted the smallest decline at 4.2 percent. The second-smallest decline was the Trump Taj Mahal Casino Resort, down 8.1 percent.

June was an exceptionally rainy month, which some industry observers suggested might have caused people to stay at home. But Nita wasn’t using that as an excuse.

“If the weather’s too good, we complain about the fact that people are outside, and if the weather is crummy, we complain about that too,” he joked.