MGM Mirage Looking To Sell Some Land in AC

Andrew Calvo | February 2, 2009 | 0 Comments

I came across an article in the Las Vegas Review Journal which linked to a Press Of Atlantic City article stating that MGM-Mirage was looking to sell the 14 acres of land it has next to the Trump Marina in Atlantic City.

It’s about time!

MGM has owned the land next to the Trump Marina for years – and unless its developed as an addition to the Trump Marina (soon-to-be known as Margaritaville Casino) its almost worthless. There is only three ways to access the property, via boat, via Huron Ave (after practically driving through the Trump Marina structure) or Brigantine Blvd – requiring those coming from the North to drive through the Harrah’s structure

In essence it’s a very secluded property that requires you to essentially drive through a competing casino – and would be great for a park or the owners of the Trump Marina, or perhaps a luxury condo or apartment development.

One of the biggest drawbacks to purchasing the property (besides it being so secluded) is its location right on the bay – the amount of permits and variances that would be needed to develop property that close to the bay – especially in NJ which recently made it harder for any development to be built within 400 feet of a waterway.

I think we’ll end up seeing this property be sold to the future owners of the Trump Marina as an insurance policy for future growth on the property – either a second hotel/casino or a huge addition to the existing hotel/casino.

In regards to the LVRJ’s speculation that MGM-Mirage is looking to get rid of Borgata and perhaps the 72 acres next to the WaterClub where the MGM Grand Atlantic City was scheduled to be built – I’d be very surprised to see MGM sell both properties. I could see the sale of the Borgata’s 50% interest – Boyd Gaming is the company really behind the operation – MGM is pretty much just there for the money backing – the MGM Grand property is too large for MGM to give up.

A Lot of people love to predict the demise of Atlantic City, with casinos opening in PA, Philadelphia, New York, Delaware and CT – a lot of Atlantic City’s player base is being eroded; what a lot of folks fail to realize is that those clientele were the same group who only went because they were given $30 in free slot dollars and a coupon for a free buffet. That’s not where the money is in Casino/Resorts. The Borgata showed that when after they opened they had the largest quarter over quarter profits – until this economic downturn of course – and is unique because the Borgata does not allow casino tour buses to drop off at the property. Additionally, the Borgata has some destination places within the property – restaurants owned by celebrity chefs and clubs which attract the celebrity set week after week.

Atlantic City isn’t going anywhere – and MGM Mirage would be foolish to sell the 72 acres next to the Borgata. They’ve owned the land this long, and if they are looking to raise cash – they are better off selling land in Las Vegas or perhaps some of their casinos in Las Vegas and surrounding areas (Mirage? Rail Road Pass?).

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