ennsylvania has been growing by double-digit margins at the same time that Atlantic City’s gaming revenue has plunged 30 % since peaking at US$ 5.2 billion in 2006. Pennsylvania’s 10 casinos, which are spread across the state, took in about US$ 2.5 billion in revenue in 2010, compared to US$ 3.6 billion for the 11 gaming halls in Atlantic City.
As Atlantic City continues to decline, it seems inevitable that Pennsylvania will become the next US$ 3 billion market and should surpass New Jersey for the nation’s No. 2 spot in gaming revenue behind Nevada, analysts told an industry conference.
“Pennsylvania gaming, sometime next year, will most likely be bigger than Atlantic City,” Andrew Zarnett, managing director of Deutsche Bank, said during a panel discussion at the Pennsylvania Gaming Congress.
Zarnett and other Wall Street observers believe Atlantic City will continue to struggle as competition intensifies in the Mid-Atlantic gaming market, including the opening later this year of a new slots parlor at New York’s Aqueduct racetrack.
Even the opening next year of the US$ 2.4 billion Revel casino may not be enough to reverse Atlantic City’s slide, the analysts stressed. Revel, a Las Vegas-style megaresort, is being counted on to draw high-end customers and more conventions.
However, Zarnett contended that Revel will not expand the market overall. He warned that Revel might cannibalize a large piece of the marketplace from the existing casinos.
In addition to the opening of Revel, Atlantic City’s hoped-for recovery will depend in large part on changing the town’s reputation as a crime-ridden area, Steinberg said.