With the Caesars/Eldorado merger continuing to approach the finish line, additional details continue to float out about what changes will happen as a result of the merger. Some of these have been property sales as Eldorado looks to make sure the new Caesars Entertainment (what it will be called after the companies combine) is managable, and can achieve the $500 million in cost savings projected at the onset.
One of the latest announcements relates to a market many were wondering about, Atlantic City, since it was questionable whether Eldorado would be able to have 4 casinos out of 9 in a market that’s shrunk since Caesars last owned four casinos (at the time there were 12).
That question has been answered, as Bally’s Atlantic City is being sold to Rhode Island-based Twin River Holdings. Twin River has been acquiring a number of properties in recent years, with East Coast properties in both Rhode Island and Delaware, and so having an Atlantic City property seems like a savvy marketing move for them. Similar to Mohegan Sun and their management of Resorts, this could allow for property cross-marketing and to gain a foothold in Atlantic City.
For Eldorado and Caesars, they’ve kept the Wild Wild West space in the deal, which includes their new sportsbook and very popular weekend nightlife spot. The remaining property space is still quite expansive, but they get to prune their AC holdings. Tropicana is a massive sprawl of a space, with hotels like the Chelsea annexed on over the years, and so they will still have lots of room and casino space to leverage and woo customers.
Bally’s is the property that got the least attention over the years; Only a small set of rooms at the top of the Bally’s tower were renovated into Jubilee rooms; the Dennis Tower is woefully out of date and worn by now, and many of the other rooms aren’t far behind. Meanwhile Harrah’s has been heavily renovated, and as their most successful AC property, makes sense.
Tropicana has seen a lot of investment, and many of Caesars’ rooms have been updated. So it also seems like it’ll be less intensive on the company to get rid of the rooms in most dire need of refurbishment, and sell it to a company who may want to take that on.
Both companies will benefit from the fact that the properties are connected, something I doubt will change post-acquisition, just like the Claridge still being connected to Bally’s post sale. That means they’ll still have players walking back and forth, and both will benefit from that shared traffic.
To me, this seems like a savvy move for all involved, and should help to continue to see Atlantic City receive investments that continue what’s happened at Hard Rock, Ocean, Golden Nugget and so on. I do have a soft spot for Bally’s as it’s one of my first AC experiences and the place I’ve stayed most often so far, but the changes should be a net positive for players and the region alike.
