It was a day to celebrate and reward all the employees of Hard Rock Atlantic City, from executives to line employees to valet and housekeeping professionals.
But it also was an occasion for Jim Allen, chairman of Hard Rock International and an Atlantic City native, to issue a clarion call to other casino operators, city and state officials and lawmakers to make the kinds of re-investments that will assure those employees have a viable market in which to work.
Last Thursday, Allen came together with Seminole Tribe of Florida Chairman Marcellus William Osceola Jr., Hard Rock Atlantic City Partners Joe and Michael Jingoli, and Hard Rock Atlantic City President Joe Lupo to stage an “Employee Town Hall” at the property’s Hard Rock Live at Etess Arena facility, to thank them and reward them for the milestones achieved since the property’s June 2018 opening.
The theme of the presentation was “All Is One,” Hard Rock’s credo, which holds that every employee is as important as the chairman to the growth and continuing health of Hard Rock International and its owner, the Seminole Tribe.
Thanking the Team
The first part of the two-hour-plus festivities saw Allen and his partners, along with the tribal chairman, recognize the accomplishments of the Boardwalk property’s first 18 months, chief of which was becoming the No. 2 revenue-generator in the market (behind only Borgata).
Allen thanked the line employees for achieving the highest service scores in the industry, generating the second-highest table revenue and the No. 4 slot revenue, community service that has included more than $500,000 in donations to charitable organizations, and generating 28 percent of all media impressions.
Allen and the other executives followed up the video and verbal accolades with a much more practical show of appreciation: cash. He announced that every one of the 2,872 full-time employees of Hard Rock Atlantic City will receive a bonus in their next paycheck, with no bonus less than $250. He pledged that the operator will do this every year, and the bonuses hopefully will get larger every year.
“We will continue to value our most important asset,” Allen told his employees, “and that’s not the building; it’s everyone who works in it.”
The demonstration of appreciation culminated in a sweepstakes drawing in which $45,000 in cash and six all-expenses-paid vacations to the new Guitar Hotel at Seminole Hard Rock Hotel & Casino Hollywood in Florida were awarded to employees gathered in the Etess Arena. The cash awards originally were announced at $20,000—separate prizes of $2,000, $3,000, $5,000 and $10,000. After they were awarded, Allen announced that he and his partners were personally funding one additional award of $25,000.
“We could not be more proud of our team members and their hard work during the last 18 months Hard Rock Atlantic City has been open,” Allen said. “Today is about you. We are committed to the future of this property and we hope that together we can continue to work hard in providing the best possible service for guests visiting our resort destination.”
Issuing the Challenge
After the celebration ended, though, Allen turned his attention to the market surrounding Hard Rock in Atlantic City.
When the executive took questions from gathered media following the event, those questions almost exclusively asked Allen to follow up on complaints he first aired in an early December podcast conducted by Global Gaming Business Publisher Roger Gros. At that time, he said Hard Rock’s $562 million investment in Atlantic City is not being reciprocated with efforts by state and local government to make physical improvements to the city, or by other operators to reinvest in their own properties, or even to put in efforts to make the city more attractive.
Allen focused much of his criticism on the aspects of Atlantic City that project an image that is the opposite that of a destination resort—dilapidated, with vacant hotels and other vacant buildings, main streets populated by bedraggled vagrants and worse, and persistent infrastructure problems that include unattended problems as simple as the failure to fix broken street lights.
“The first (priority) in any study you look at? The town has to feel safe,” Allen told GGB News and other media. “That’s No. 1.” He noted that Hard Rock has pumped many resources into helping Atlantic City residents on the fringes of society, but that the public sector has not reciprocated.
“We have to help the people who have mental challenges, or are homeless, or who have alcohol or drug problems,” Allen said “(Hard Rock AC partner) Joe Jingoli does an amazing job with that. But very candidly, companies shouldn’t be doing that. The town—the county, the city, the state—they should be doing those things. We’re doing it ourselves.”
Allen called on Acting Mayor Marty Small, the state Casino Reinvestment Development Authority (CRDA), and New Jersey state legislators to join together with the industry to address the physical appearance of the shore resort. “The first thing you’ve got to fix is the street lights,” Allen said. “You’ve got to fix the traffic lights. There are so many things that can be done. You’ve got to mow the lawns.”
Allen reserved much of his criticism for the owners of the last two remaining shuttered casino hotels on Atlantic City’s Boardwalk—Carl Icahn, owner of the former Trump Plaza at the center of the Boardwalk; and Colosseo Atlantic City, the New York investment firm that bought the building at the Boardwalk’s southwest end, formerly the Atlantic Club, the Atlantic City Hilton and Golden Nugget Atlantic City.
“You’ve got to go to Carl Icahn and say, ‘That building needs to come down,’” Allen said. “Carl is worth how many billions of dollars? To leave a vacant casino like that sitting—literally a safety hazard, debris falling off the building, potentially hurting someone—I don’t understand why the city and Carl can’t come together…
“We’ve worked with Carl. He and his CEO are fine people. But we don’t understand why that building is still there. And rather than what happened at the Sands—where it’s a field full of weeds, and a chain link fence that looks like it’s out of a prison, do something to make it look nice. Nothing. Nobody does anything.
“You see our entrance—it’s beautiful. We paid for everything. That’s what we need. How long has the old Hilton/Nugget been sitting there? Go to the owners, make it mandatory—do something with it, or it’s coming down and you’re paying for it. Because when these people come in and say they’re going to build a water park there, very frankly, they don’t have a clue. You’re not putting a water park in that building. The city, the state, the CRDA need to get some enforcement of eminent domain—not on the people of Atlantic City, but on some of these big-time owners that own these properties but do nothing with them.
“When these things start happening, maybe Atlantic City’s image will change. But until then, it’s scary.”
Comparisons to 1964
Allen did not spare other owners of casino-hotels in the city. Pointing to Hard Rock’s half-billion-dollar transformation of the shuttered former Trump Taj Mahal into one of the top properties in the market, he questioned the commitment of other operators to improve their own properties—even drawing a parallel to the Atlantic City of 1964, when the Democratic National Convention at Boardwalk Hall shone a national spotlight on the deterioration of the resort, a spotlight that eventually led to the legalization of casino gaming.
“Buying this building for $50 million, that was the easy part,” Allen said. “The difficult decision, which is return on investment—which, frankly, right now is zero—was putting the $500 million in above that. We’re fine; we don’t have outside debt. What people don’t seem to want to focus on is that there’s not going to be new investment into the town, and ultimately, we could become the next Reno, we could become the next Laughlin, where nobody puts any money in.
“I don’t want to name any specific property, but you can walk some of these properties and stay in some of these rooms in Atlantic City—and I’m talking about the casinos, not the secondary-market hotels—and they’re horrific. So, if we do get meeting or group business, and then they say, ‘Wow, I stayed at a convention in Philadelphia or Chicago or New York, and then I stayed in a room in Atlantic City…’ It’s (similar to) the actual demise of Atlantic City back around the Democratic convention in the 1960s. When they got the convention, everybody got here and said, ‘There’s nothing left.’ And frankly, that’s when the town truly plummeted.”
Asked about the rejuvenation of revenues in the market due to sports betting, Allen commented that a lot of that is “what we call false drop—it’s not real, it’s phantom money,” because it’s not driving reinvestment. “That’s why right now, you could buy Bally’s Park Place for $25 million. And that’s a big building. But the amount of money needed to take that to the next level is where we want to create an environment with everyone working together. I hope it sells, and I hope somebody puts hundreds of millions into it. Because that’s good for Atlantic City.
“But right now, that’s not happening. Everyone said I made a mistake investing in this town. We invested in this town because we were made a lot of promises of what was going to happen. And very candidly, nothing has happened. Nothing. And I don’t believe that elected officials at many different levels, current and past, are focused on this topic.”
