Study Finds Change in Atlantic City’s Visitors

A study by the Richard Stockton College of New Jersey finds that luxury spending is up in Atlantic City even as casino revenue shrinks. The study contends that Atlantic City’s visitors are staying longer and spending more on dining and accommodations while gambling day-trippers are declining.

While fewer visitors now come to Atlantic City, they stay longer and spend more on non-casino amenities.

That’s the finding of a new study from the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at the Richard Stockton College of New Jersey.

The study reinforces a long-held perception about the changing nature of the resort. As casinos lose revenue from day-trippers who simply come to the city to gamble, a new kind of visitor is staying longer.

“I think what’s going on is you’re getting fewer day-trippers coming down just to gamble. In effect, the quality of the visitors is going up,” Brian Tyrrell an associate professor of hospitality and tourism management at Stockton and the author of the study said. “You’re getting visitors who are coming longer and doing more. They’re eating. They’re shopping. They’re staying overnight.”

The study tracked tourism performance indicators, including Atlantic City’s luxury tax and parking fees as well as Atlantic County’s hotel occupancy fee. While parking fees have decreased, luxury tax and hotel occupancy fees both increased in August 2013.

Atlantic City’s luxury tax is 3 percent on alcoholic beverages and 9 percent on other retail sales. In August, the city collected $5 million in luxury tax, up 13 percent from the $4.4 million collected in August 2012, the study said. The $5 million was the highest luxury tax total ever recorded in the city.

In the third quarter the city collected $12.2 million in luxury tax up slightly from 2012.

Tyrrell noted that while the increase was small, Atlantic City is still recovering from a perception that the resort was badly damaged during Hurricane Sandy.

“Both luxury tax and hotel occupancy tax were trending positively until Sandy hit. Then we had a really miserably cold and wet June and July, so it’s possible there was some pent-up demand as people considered coming back to the shore,” Tyrrell said. “Hopefully, it’s a sign that any declines are in our rear-view mirror.”