Ocean Resort Casino changing hands after six months

By Kevin Jenkins | January 11, 2019 |

ATLANTIC CITY — Ocean Resort Casino will remain open and the property’s nearly 3,000 jobs are safe for now following an announcement Thursday that the megaresort was changing hands after six months of operation.

After purchasing the $2.4 billion casino hotel in January 2018 for $229 million, Bruce Deifik, the current owner, will retain a non-controlling ownership interest but an outside company will assume majority ownership. Deifik did not identify the new company.

The change comes amid six months of lagging game revenues, a $10 million lawsuit by a former employee and several other pending legal issues including construction liens.

“It has been truly an honor for myself and my family to have taken this property, opened its doors and brought back the players, the families, the convention guests and the sports betting enthusiasts,” Deifik told The Associated Press. “My family and I want to thank the 3,000-plus employees at Ocean for their tireless work to bring our property to life and put it on track to become the best gaming property in New Jersey. If approved and closed, this next round of investment into Ocean will put this property on an exciting path to growth.”

The Boardwalk property formerly known as Revel Casino Hotel reopened to the public June 27, along with Hard Rock Hotel & Casino Atlantic City. The two casinos contributed to a historic summer in the seaside resort and were heralded as key players in Atlantic City’s resurgence.

The new controlling entity plans to use about $70 million in capital to open a buffet, additional suites and rooms, and investments on the casino floor. It also plans “a substantial increase” in its entertainment programming and player events in 2019.

This summer’s reopenings brought Atlantic City’s casino total to nine, shortly after five casinos had shut down in a market that could not support them all. The Atlantic Club, Showboat, Revel and Trump Plaza closed in 2014, and Trump Taj Mahal closed in 2016.

The revival of the two casinos immediately raised questions as to whether Atlantic City was making the same mistake that led to the first wave of casino shutdowns: having too many for them all to thrive.

Rummy Pandit, executive director of the Levenson Institute of Gaming, Hospitality & Tourism at Stockton University, said he would “definitely disagree” with that assessment.

“The possible change is a function of financial structure for a property,” he said. “It is not necessarily a function of revenues generated.”

Bob Ambrose, an adjunct professor of casino management at Fairleigh Dickinson University and an industry analyst, also shot down the narrative that Atlantic City was oversaturated.

“That property (Ocean Resort), under the right branding and marketing, can survive as a resort experience and contribute to Atlantic City,” Ambrose said.

Both Ambrose and Pandit said they believed Deifik’s investment was a positive sign not only for the property but for the city itself.

But they added the new company’s investment would help complete Ocean Resort’s transformation by using the funding to complete the 10 unfinished floors of hotel rooms, add additional amenities, such as a buffet, and make use of other underutilized space on the property.

Guests and visitors to Ocean said they were surprised to hear the news Thursday.

Sue and Jim Small, of Philadelphia, arrived at Ocean on Wednesday night and were staying until Friday. Both said their first impression of the casino was how beautiful it was. But while acknowledging that a midweek in January might not be the best representation of how well the property is doing, both expressed surprise at how few people were on the casino floor or in the restaurants.

“With the lack of people in there, I was wondering how they could afford to stay open,” said Jim Small.

Despite the appearances of a struggling gaming hall, employees inside said they were aware of the change at the top but were informed their jobs were not in jeopardy. One security guard, who asked not to be identified because he was not authorized to speak to the media, said most of the employees were told about Deifik’s departure Monday. The employee said a significant investment by the new company will partially be used to make payroll for “several months” and allow workers to keep their jobs.

The new company will need to be thoroughly reviewed by state gaming regulators to secure a casino license, unless the mystery company is already licensed in New Jersey.

“The Division of Gaming Enforcement has been performing its statutory responsibilities with regard to the Ocean Resort Casino hotel facility and carefully monitoring operations, including financial matters related to it, as it does with all casino licensees,” said Kerry Langan, spokeswoman for the gaming regulatory body. “The division has been working closely with all relevant parties and will continue such regulatory activities so that the property can move forward, including the review of any transactions that require regulatory approval.”

City Council President Marty Small said he has heard rumors for months that there was a possibility that the majority owners of the casino could change.

“Moving forward, hopefully with further investment, they (the new majority owner) will bring a new vision, not only to make the Ocean Resort sustainable, but profitable as well,” Small said.

Staff Writers Michelle Brunetti Post and Vincent Jackson contributed to this report. The Associated Press also contributed.

No record of a transaction has been recorded with the Atlantic County Clerk’s Office regarding Ocean Resort Casino changing ownership.

Evening view of the Ocean Resort Casino in Atlantic City. The Hard Rock and Ocean Resort Casinos opened for business, Thursday June 28, 2018. (Dale Gerhard / Press of Atlantic City)

Deifik Bruce Deifik, Ocean Resort owner, speaks during an editorial board meeting at The Press of Atlantic City in Pleasantville Wednesday, Nov. 14, 2018.

Crowds walk the boardwalk in front of the Ocean Resort Casino in Atlantic City. The Hard Rock and Ocean Resort Casinos opened for business, Thursday June 28, 2018. (Dale Gerhard / Press of Atlantic City)

Ocean Resort Casino, in Atlantic City, Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Luxor Capital Group is now the majority stakeholder in Ocean Resort Casino in Atlantic City.</p><p class=

/ For The Press” width=”800″ /> Luxor Capital Group is now the majority stakeholder in Ocean Resort Casino in Atlantic City.

/ For The Press

The Ocean Casino Resort has greatly reduced its debt, according to Eric Matejevich, the casino’s interim CEO.

Ocean Resort Casino, in Atlantic City, Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Steve Hagan and Kathy Nagy, of York, PA, talk about the recent sale of Ocean Resort Casino, in Atlantic City, while at the casino,Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Jim and Sue Small of Philadelphia, PA, talk about the recent sale of Ocean Resort Casino, in Atlantic City, while at the casino,Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

With the announcement Monday that Luxor Capital Group, a New York-based private investment firm, had assumed majority control of Ocean Resort Casino, many are wondering what the future holds for the struggling property.

Marie and Alan Mioduszewski, of New Brunswick, talk about the recent sale of Ocean Resort Casino, in Atlantic City, while at the casino,Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Ocean Resort Casino, in Atlantic City, Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Marie Mioduszewski, of New Brunswick, Middlesex County, says she used to gamble at Ocean Resort when it was Revel Casino Hotel. ‘It was dead at that time, too,’ she said. ‘I didn’t think it was going to make it then, either.’

Ocean Resort Casino, in Atlantic City, Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Jim and Sue Small, of Philadelphia, say they were impressed by how beautiful Ocean Resort Casino was but were surprised by how few people were on the casino floor or in the restaurants.

Sue Small of Philadelphia, PA, talks about the recent sale of Ocean Resort Casino, in Atlantic City, while at the casino,Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Ocean Resort Casino, in Atlantic City, Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)

Kathy Nagy, of York, PA, talks about the recent sale of Ocean Resort Casino, in Atlantic City, while at the casino,Thursday, Jan. 10, 2019. (For The Press / VERNON OGRODNEK)