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Atlantic City Post-Sandy: Struggling Casinos Slowly Rebound, Look Ahead

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Eater's Amy McKeever recently went to Atlantic City, New Jersey, to talk with chefs, restaurateurs, and city representatives to learn their Hurricane Sandy stories and peer into the city's recovery. This is the last in a series of five reports exploring post-Sandy life in Atlantic City, focusing on the casino industry and the people who make it run.

[Photo: Amy McKeever/]

Dean Dupuis returned to Atlantic City to check on his restaurant as soon as he could, which was not until four or five days after the storm. After flashing his employee ID to cross the blockades, Dupuis drove through the empty city streets where electricity was only available in patches and traffic lights dead. "It's almost like the town disappeared," he says, later adding, "You knew bad things were happening."

The streets near the city's newest multibillion-dollar resort and casino were still drowned in water as Dupuis pulled up to Revel. He noticed little signs of damage here and there as he walked inside: some flooding on the employee entrance level, leaks in the lobby. And those leaks had managed to work their way down into the kitchen of Mussel Bar & Grille by Robert Wiedmaier, where Dupuis has worked as chef de cuisine since it opened in April.

But the structural damage to Mussel Bar and Revel was negligible. The resort didn't lose power at all, but the restaurant did lose about $5,000-6,000 in product. After all, meats, cheeses, and their supply of Gulf seafood had been sitting unused for nearly a week. It all had to go. It could have been worse, Dupuis says. He could have lost up to $20,000 worth of product. So there's that. But, then again, "five to six grand when we're slow makes a big difference."

Dean Dupuis. [Photo: Mussel Bar]

Atlantic City Slows Down

It might be an understatement to say that Atlantic City casinos were slow in the weeks after Sandy tore through the area. "What happened immediately was that nobody wanted to come here," Dupuis says, "All of a sudden people thought Atlantic City was washed away into the ocean." And so Mussel Bar remained shuttered for weeks after the storm. They tried to open one Sunday two weeks after Sandy, Dupuis says, and did four covers all day. After another week, they reopened on weekends only, getting about 30-40 people a day. Dupuis describes it as a Catch-22: People weren't coming because they thought nothing was open, and restaurants couldn't open because people weren't coming.

Public perception of Atlantic City's devastation — such as those reports of a destroyed boardwalk — was a significant culprit in all this. (The false media reports came up in every interview conducted for this series.) Locals also weren't coming because they had their own struggles. Then there were the two major conventions that canceled, sending November's potential convention-related visitor numbers plummeting from more than 60,000 to just 45 delegates.

[Photo: Amy McKeever/]

Though there aren't hard numbers for how the casino restaurants as a whole fared in the immediate aftermath of Sandy, gaming numbers illustrate the stress on the city's already-declining economic engine. Between October 26 and November 9, per a press release, total casino win was down 63 percent compared to the same period of the previous year. That said, casino win for Atlantic City's 12 properties varied. Bally's and Tropicana were down 46 and 45.3 percent, respectively, in November 2012 as compared to November 2011. Meanwhile, The Atlantic Club and Borgata were down only 10.6 and 15 percent. Even better, the Golden Nugget was down a mere 0.4 percent.

But no variance in casino wins could sugar-coat the five days of lost revenue as a result of New Jersey Governor Chris Christie's casino shutdown, only the fourth casino shutdown in the city's history. As Atlantic City Alliance chief strategy and communications officer Jeff Guaracino explains, anytime you close a city for five days, it's going to be a slow ramp-up.

A Tough Time For Atlantic City's Workers

Back at Mussel Bar, Dupuis fielded calls from his employees every day after the storm, clamoring for shifts to help pay for the damage suffered in their personal lives. "People were begging to come into work," he says. Dupuis himself was dealing with issues at home. On the night of the storm, the first level of his home in Tuckerton, New Jersey, had flooded with four feet of water. Boats were floating down the street and from his window he saw only water. In the middle of the night, he and his wife called 911 and were taken to a packed shelter. When they returned the next afternoon, Dupuis says, they discovered much of their belongings were lost. All the carpet and sheetrock would need to be ripped up.

Many of Atlantic City's employees were dealing with similar losses. Bob McDevitt, president of the Local 54 workers' union, recalls driving across town on the Sunday after the storm. Though he couldn't tell the homes he passed were damaged from the outside, it was clear from the waterlogged belongings out on the curb. "Everybody's life was on the curb," he says.

[Photo: Amy McKeever/]

Those people could have used all the shifts they could get to help pay for the damage. But rather than flat-out laying people off, many employees saw their shifts reduced well below what they needed. Joseph Giunta, regional vice president of food and beverage for Caesars Entertainment, explains that the group's four properties (Caesars Palace, Bally's, Harrah's and Showboat) are union houses and therefore schedules go by seniority. Unfortunately, the on-call schedules for those with less seniority have "pretty much have gone away," he said, adding that the company is doing its best to protect the senior shifts.

Dupuis also doled out whatever work he could at Mussel Bar, bringing people in to clean up the restaurant in the weeks that they were closed. The tough part came when Mussel Bar reopened on weekends only: He had to choose which staff members to lay off so they could at least collect unemployment benefits.

A Community Provides Relief

Though it couldn't give them what they needed most — regular employment — Caesars Entertainment did quite a bit to help its needy employees. Giunta says the group held food and clothing drives, and provided information regarding FEMA and insurance money. The Caesars Entertainment Sunshine Fund also raised hundreds of thousands of dollars for employees affected by the storm: Notably, they raised a half million dollars hosting a charity hockey game during the NHL lockout and another $50,000 through a dinner held at Philadelphia's Table 31.

Borgata also did a lot of fundraising for employees and the wider community, hosting a Neil Young concert that raised a quarter of a million dollars, as well as a benefit drive that raised close to $100,000 for employees who had suffered losses related to Sandy. The company itself also donated $50,000 to the local Red Cross, says Joe Lupo, senior vice president of operations for the casino.

Local 54 president Bob McDevitt helping casino employees file for emergency in-service withdrawal of severance funds. [Photo: Amy McKeever/]

But McDevitt of the labor union says many of the other casinos were in such a bad position that they couldn't do anything to help employees. And, he adds, it's hard to blame them. They had their own hardships. So that's where Local 54 and other organizations stepped in. For example, church volunteers helped Dupuis and his wife tear the sheetrock from their home when contractors were slammed — or, in some cases, engaging in price gouging — after the storm.

The Local 54 itself implemented a three-pronged approach to helping members, who are mostly casino employees. It helped people fill out FEMA forms and distributed 2,500 grocery store gift cards around Christmastime to members whose work schedules had been reduced. And the union spent two weeks in January helping casino employees apply for an emergency in-service withdrawal of their severance fund.

Atlantic City Rebounds

Dupuis doesn't know for sure whether business is back to normal at Mussel Bar now. After all, the Revel only opened in 2012, so he still hasn't experienced a typical off-season. But, he says, it's all picked back up. All of his normally scheduled off-season employees are back at the restaurant, which is now open five days a week. From what he hears from colleagues who have been around longer, Mussel Bar seems to be pulling an almost-normal number of off-season covers. But he doubts it's back at 100 percent. "I think [Sandy] really did a number on us," he says.

Caesars Entertainment properties such as Caesars Palace are rebounding from the storm. [Photo: Amy McKeever/]

Giunta also acknowledges that it took Caesars Entertainment a while to ramp operations back up at the group's four properties. In January, he says, the group was up to about 80 percent of their normal off-season restaurant lineup, while now it's closer to 90 or 95 percent. He's optimistic for recovery, hinting that Caesars F&B numbers are going to grow considerably in 2013 under some new initiatives. Meanwhile, Lupo reports that the Borgata is already back to its normal off-season F&B levels. The Borgata's casino revenue numbers have bounced back quite nicely since the storm as well, from a 15 percent decline in November to a three percent decline in December. January numbers come out Monday.

Those numbers are rebounding for others as well. The December 2012 casino win fell 8.9 percent from what it had been in December 2011, which was a dramatic improvement over the 27.9 percent decline in the previous month. Some individual casinos didn't do quite so well, though, with Tropicana posting a 40 percent decrease from December 2011. The rebranded Golden Nugget was the only casino to post an increase from the previous year at 7.4 percent.

Looking Ahead

But Atlantic City isn't placing its post-Sandy bets just on gaming revenue, which has seen a consistent year-to-year decline in recent times, says Guaracino of the Atlantic City Alliance. Non-gaming revenue — such as the F&B side of the casino-hotel operations — has seen an uptick as the city has shifted its marketing strategy to promote tourism beyond gambling. And so now Atlantic City has turned its attention to letting those all-important tourists know that they're back in business.

New restaurants such as Margaritaville are expected to help reinvigorate Atlantic City in 2013. [Photo: Amy McKeever/]

Guaracino says the Atlantic City Alliance launched a $2 million recovery campaign to remind people that the famed Atlantic City boardwalk is still intact. The city is already marketing its upcoming Atlantic City Restaurant Week, slated for March 3-9. And properties are doing their own promotions, too. Lupo attributes the Borgata's quick recovery to its aggressive marketing, saying that while some casinos pulled back their programming after the storm, the Borgata took it up a notch by bringing in more entertainment and going through with the long-planned Savor Borgata in early November.

Revel is working closely with the ACA to dispel that boardwalk destruction myth, says Darlene Monzo, senior vice president of marketing. Even though that resort has had a rough go of it as the newest casino in town — requiring a $150 million cash infusion in December — Monzo is optimistic about 2013. She anticipates high volumes with Valentine's Day and Presidents' Day weekend, not to mention Revel's plans to unveil a new lounge, day club, and a noodle bar from José Garces in the second quarter of the year. Revel is also a sponsor of the April Fools Half-Marathon, which will prominently feature the perfectly intact boardwalk as part of its course. So Sandy will not be the last word of Atlantic City. As Dupuis puts it, "We definitely got hit hard, no question. But we're still here."

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