eaving Atlantic City’s biggest and most profitable casino for Australia wasn’t an easy decision for its top executive.
Boyd Gaming Corp., which co-owns the Borgata with MGM Mirage, announced last week that Mullin was resigning January 5 to become CEO of the casino division of Tabcorp Holdings Ltd., a Melbourne company that operates four casinos in Australia.
"The market in Australia is a huge locals market," Mullin said. "The casino in Sydney has 4.8 million people to draw from, and it’s the only one in that market." He said that, similar to Atlantic City, which is still predominantly a day-tripper market that is trying to develop more overnight guests, many who frequent the Sydney casino are locals who return home the same day. Tabcorp wants to attract a higher-end international customer who stays overnight or longer.
Mullin, who will be based in Sydney, said Tabcorp was pouring us$ 475 million into its Star City Hotel & Casino there - and repositioning it as a must-see, overnight destination resort. His departure comes as Atlantic City faces daunting challenges. They include new regional slots competition, a bad economy, and a credit crisis that has stalled development.
Boyd Gaming placed a massive bet on the us$ 1.1 billion Borgata in 2003 to begin the transformation of Atlantic City into an overnight destination, with Las Vegas-style casinos featuring luxury hotel rooms, spas, upscale retail, nightclubs, and top concert acts. The casino’s philosophy, modeled after Las Vegas venues, was to have everything under its roof generating revenue. Several casino operators in Atlantic City soon emulated "the Borgata model."
Mullin, who was tapped by Boyd to become Borgata’s executive vice president of marketing in 2002, a year before it opened, has been integral in developing the Borgata brand. With its edgy decor, high-tech design, and Borgata Babes cocktail waitresses, the Borgata brought in the younger, affluent crowds from New York and Philadelphia and made entertainment a potent part of the casino experience.
Tabcorp is asking for much of the same. "They looked at the US, specifically Atlantic City, and more specifically the Borgata and what Borgata had done to reposition Atlantic City," Mullin said. "They want to differentiate themselves in Australia and become an overnight destination."
Besides its biggest property in Sydney, Tabcorp owns three smaller casinos. The four combined offer more than 4,500 slot machines, 399 table games, and 1,409 hotel rooms. By comparison, the Borgata has 4,100 slot machines, 200 table games, and 2,800 hotel rooms. The casino has led the Atlantic City market virtually every month since opening nearly 51/2 years ago.
Ian Manning, VP of global due diligence investigations for consultant Spectrum Gaming Group, said Tabcorp, a former corporatized betting agency, was moving aggressively to establish a name for itself. "It’s on their agenda to set up an overseas gaming destination," said Manning, a former gaming regulator in Australia. "Perhaps new blood will develop that potential market."
Mullin, a former Cardinal O’Hara High School running back and a graduate of West Chester University, spent his entire 23-year casino-industry career in Atlantic City. He previously held executive-level positions at all three Trump casinos in Atlantic City from 1988 to 2002.
Mullin was promoted in 2004 to executive vice president and chief operating officer of Borgata. In 2006, he was named president and chief operating officer. "I always wanted to challenge myself, and they are giving me the opportunity to grow at this point and time," said Mullin, who was given an equity position in Tabcorp. "For me, it’s a step up running a company versus just a property."
Robert Boughner, who developed the Borgata and served as its CEO from 2003 to 2006, will oversee the Borgata until a replacement for Mullin is found. He is currently in charge of Boyd’s us$ 4.8 billion Echelon Resorts project on the Las Vegas Strip. That project, as well as three of four mega casinos planned for Atlantic City, has been placed on hold because of the difficulty in securing financing.