April 1, 2012
Repriming the Pump
The state of New Jersey, addicted to casino revenues, reinvests in a struggling Atlantic City.
New Jersey Casino Reinvestment Development Authority
I was still in high school the last time I set foot in Atlantic City. It was in the early 1970s, several years before the first casino opened its doors. My most powerful memory of Atlantic City isn’t even mine—it’s borrowed from the 1980 Louis Malle movie of the same name. In it, the bittersweet nature of the gambling boom is represented by footage, filmed in 1972, of the historic Traymore Hotel being demolished.
In February, I received an e-mail heralding a new Tourism District Master Plan that was “approved” at a meeting of the Casino Reinvestment Development Authority (CRDA) in Atlantic City. A year earlier, New Jersey’s state legislature had handed control of the funding and development of a new revival strategy to the CRDA, a state agency tasked with investing a percentage of casino revenue in public works projects, both locally and throughout the state. The plan’s lead consultant was the giant real estate consulting firm Jones Lang LaSalle, and it included, as master planner, the Jerde Partnership, an architecture and design firm known for creating attractions such as the Fremont Street Experience, which converted squalid downtown Las Vegas into a multimedia extravaganza. It was finally time for me to return.
History is repeating itself in Atlantic City. With its endless boardwalk, grand hotels, and disinclination to enforce Prohibition (see Boardwalk Empire) the city was, for the first half of the twentieth century, the country’s premier seaside resort. The population peaked in 1930, at 66,000—today it’s 39,000—and its decline was caused by the arrival of other options. Prohibition ended. Newly minted suburbanites could ride out summer in their air-conditioned homes and backyard swimming pools. And moneyed travelers began jetting to more exotic locations, like Miami Beach. Atlantic City’s hotels emptied out, and the city was afflicted with all the ills typical of postwar urban America.
The cure for Atlantic City’s troubles was gambling. With the state legislature’s approval, gargantuan, casino-driven resorts sprang up, and the city boomed again. In 2006, the gaming industry’s peak year in Atlantic City, the area’s dozen casinos earned over five billion dollars. Since then, the totals have slipped. In 2010, the total revenue was only $3.5 billion. Some of the decline was due to the recession. But once again, people who were drawn to Atlantic City in the past have other options: Foxwoods or Mohegan Sun in Connecticut, Aqueduct Racetrack’s new “racino” in Queens, or the SugarHouse casino in central Philadelphia, an hour west. The State of New Jersey now depends on the taxes and fees paid by the casinos, which amount to nearly a billion dollars a year, and it simply can’t afford to let the city’s appeal fade. So the CRDA chose to use a portion of their funds to freshen this wilting flower. Their concept: transform Atlantic City into—wait for it—a beach resort.
I met with one of the project’s urban planners, David Sheldon, a Jerde vice president, and suggested that what the master plan proposes for Atlantic City mirrors the transformation of Las Vegas in the 1990s, when casinos added themed attractions and spectacles to make the city more appealing to those whose idea of a good time is not a 48-hour blackjack binge.
Sheldon disagreed, pointing out that Las Vegas generates four times the gaming revenue of Atlantic City and has over 50 times the population. And shouldn’t Atlantic City be easier to diversify? Its miles of beaches would seem to provide natural advantages over the Nevada desert city.
Actually, nature is the source of one of Atlantic City’s problems: winter. Sheldon says the plan is to “rebrand the Boardwalk as a four-seasons destination.” He shows me one rendering of a band shell where events could be staged year-round—perhaps The Nutcracker in December—and another of a giant light show, the Boardwalk equivalent of the Bellagio hotel’s dancing fountain in Las Vegas. The plan also proposes a series of pavilions that corporations could rent to show off their latest innovations. At the north end of the boardwalk, near a part of town that Sheldon says is beginning to attract tech firms, there will be a monumental, wind-driven sculpture. The goal is to transform the boardwalk into “a well-illuminated, safe destination.”
On my first visit to Atlantic City in almost 40 years, I began at the north end of the Boardwalk, driving up from behind the nearly completed Revel Resort and Casino, a skinny slab of smoke-colored glass that’s topped by what looks like a giant golf ball. Due to open next month, the Revel is intended to lure an uncharacteristically sleek crowd to Atlantic City. The $2.4 billion project, initiated and eventually dumped by Morgan Stanley, had to be rescued by the State of New Jersey, which extended a $261 million tax credit to the development. The state’s money reassured private investors, who came back to the project with over a billion dollars worth of loans. (Have I mentioned that New Jersey can’t afford to let Atlantic City fail?)
The Boardwalk itself was a happier place than I expected. Maybe because it was Valentine’s Day—which is celebrated in Atlantic City with a group wedding ceremony at Boardwalk Hall—there were a handful of youngish people promenading. There are lightly used casino entrances along the Boardwalk—most people come and go through the parking garages—and I saw endless T-shirt shops, a couple of saltwater taffy outlets, some dubious-looking massage parlors, and a slice of beach reserved for feral cats. It wasn’t a vibrant place, but it wasn’t totally desolate, either. Nothing a big light show and a savvier retail strategy couldn’t fix. It’s hard to go too far wrong with a boardwalk and a beach.
The Atlantic City waterfront is, however, a landscape completely distorted by the peculiar culture and economy of casinos. The attributes that the new master plan calls for—the “communal atmosphere within and around a network of urban streetscapes”—are exactly the qualities that casinos render unnecessary and impossible. Like all casinos, the ones in Atlantic City have a variety of themes on the outside—India, ancient Rome, the gold rush—but inside, the theme is always the same. Casinos are crafted to keep you from even thinking about the outside world. There is a big, beautiful ocean right outdoors, but if you’re deep inside the Showboat or the Taj Mahal, you’d be hard-pressed to find it.
Pacific Avenue, the street that runs parallel to the Boardwalk, is lined with parking garages. It also features many acres of vacant land, and blocks of shabby old buildings that, in some other seaside location, would have been restored long ago. “It was one big Mon-opoly game down there,” explained Paul Mas, a managing director at Jones Lang LaSalle. “The reason why you see a lot of undeveloped areas or blighted buildings is because speculators would buy a lot of them up, hoping that a casino would come to them.”
The new master plan has a genius fix for the Pacific Avenue problem. The idea is to, as Mas puts it, “recapture” ground-floor spaces from the parking garages, and fill them with cafés and shops. The Jerde renderings show currently blank facades lit up like Times Square. The plan also calls for transforming Atlantic Avenue, a seedy strip of tattoo parlors and pawn shops one block further west, into a more inviting shopping street
or area residents.
Overall, the master plan is well-intentioned, decent, smart—and perhaps, ultimately, doomed. The whole scheme is an attempt to make Atlantic City into the place it might have become had the casinos never happened, and had depressed real estate values and a gorgeous seaside location eventually attracted a smart new generation of entrepreneurs and investors. Without the casinos, it could have been. The stated purpose of this plan is to turn Atlantic City into “the preferred coastal resort destination of the Northeastern United States.” But really, it’s to make Atlantic City into a more attractive place, so the casinos can continue filling the state’s coffers. In other words, New Jersey is using money generated by gambling to save the casinos from themselves.