Experts are predicting a very poor outlook for Revel indeed, after the casino was hit harder than most by the effects of Hurricane Sandy after months of struggling to keep up with their competitors. The casino had been eighth in terms of revenue in the months from May all the way through to September, but in October it fell further to be beaten even by the older and smaller casinos in the area that you would expect not to raise as much.
Analysts now say that it is unlikely that enough people will come to play on their slot machine games to save Revel from its doom, as they have a massive debt that it looks like they will need to default on. Even now with more customers coming back to the city, the revenue that they earn will need to be spent right away on cleaning up the storm damage, rather than actually helping to pay off some of those costs which are continually growing steeper. Moreover, the more affluent customers who would often come down from New York or elsewhere in New Jersey are spending their cash on their own clean up operations, rather than coming in to the city to gamble with it.
“There is no doubt the probability of default has increased,” Andrew Zarnett of Deutsche Bank AG said Wednesday. “There is no way to dispute that, given what has happened to Atlantic City the last two weeks.” Unfortunately for the owners, it was Revel that certainly had the most to lose when Sandy blew through and caused businesses to shut down for five days: having only opened seven months ago, it is still trying to build up a loyal customer base, and they have not yet managed to pay off enough of their debt to lighten the load after the massive costs of building and furnishing the casino. The loan of $850 million that was taken out to start the business is due in 2017, and it looks unlikely that they will ever be able to make that payment in time.