Ocean Casino Resort has seen several changes as of late, after having only been in operation in Atlantic City, New Jersey for just over a year. This week, gaming regulators in the state decided to advance the controlling interest of the casino by a hedge fund located in New York as well as approve an individual to be a trustee of the venue.
Interim Casino Authorization
On Wednesday, the Luxor Capital Group was given interim casino authorization by the Casino Control Commission. This approval was given after a long public hearing process. There were several financial conditions that had to be met by the hedge fund as stated by the Division of Gaming Enforcement. The group met those conditions, which were set to protect the stability of venue.
With the authorization, the group now has temporary control of the casino. This was given after an investigation was conducted by the Division of Gaming Enforcement and the Commission gave their approval as well.
With this decision, another review must take place, a more comprehensive one, to determine if the Luxor Capital Group is qualified for casino licensing. The Ocean Casino Resort is in need of stability as they opened back in June 2018 and have yet to gain a proper foothold in the gambling marketplace.
During the public hearing that took place, it was revealed that the casino had lost close to $23 million during a seven month time frame. They were also unable to meet financial conditions that were set by gaming regulators in the state.
Bruce Deifik got the casino off the ground as the Ocean Resort, only to parish in a car wreak a few months ago. One of the primary financiers of the purchase of the casino was the Luxor Capitol Group. The company assumed control of the casino back in February based on a trust agreement.
Luxor is excited to be part of the future of Atlantic City and the continued success of the casino. They look forward to working with employees as well as the management team.
Investing into Ocean Casino
Luxor has already invested close to $70 million into the casino. Close to $50 of that amount was used to pay down debt that was owned to J.P. Morgan, a second primary lender of the property. Since the company took over, numbers have improved greatly.
During the first six months of this year, the casino earned over $102 million in gaming revenues. In June, the property reached an all-time high regarding their total gaming revenue numbers, slot revenues and occupancy within their hotel. This helped the property to continue to see profitability.
Despite the improvement in the financial condition of the property, it is still imperative that regulators monitor the ongoing financial stability of the venue via the ICA process. The Casino Control Commission is aware of the struggles that the Ocean Casino has endured and they question if the asset will be operational.
Overall, the Commission is happy with the way that Luxor has went ‘all in’ so to speak with investments into the property. According to the Commission, it seems that the casino is competitive and positioned to generate cash flow.
For the trust position of the ICA, the Commission decided on Gary Van Hettinga. The position will be held by Gary while a permanent chief executive of Ocean is considered.
