Pinnacle Permanently Abandons Atlantic City Casino
Pinnacle Entertainment (PNK: 11.01 0.00%) is abandoning plans to develop in Atlantic City “due to the continuing economic downturn of the gaming market in Atlantic City as the result of other competing markets, primarily Pennsylvania, as well as the continued deterioration in commercial real estate values in the area.”
Pinnacle has put the 19 acres on the seaside boardwalk up for sale after writing down the property by $160 million in the fourth quarter of 2009.
The land was purchased in 2006 for $270 million, when the gaming company demolished the former Sands Casino to make way for a $1.8 billion gambling resort.
Plans for the development were halted in February 2008 because of problems accessing credit.
Atlantic City gaming revenue has been on a downward spiral for the past three years with a record decrease of 13% last year.
Many have contributed Atlantic City’s loss to neighboring states opening casinos as a way to build their budgets.
Three years ago New York and Pennsylvania permitted slot machines and Pennsylvania has not permitted those casinos to open table games, leading to six of New Jersey’s 11 casinos going bankrupt, restructuring debt or halting development.
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