Did Donald Trump Help or Hurt Atlantic City’s Casino Industry?
Donald Trump garnered a reputation as America’s most flamboyant billionaire long before he was elected president in 2016.
He was primarily renowned as a New York real estate tycoon, but he also emerged as a heavyweight in the entertainment business, first as the owner of the Miss Universe pageant and then as the charismatic host of The Apprentice.
Over the course of his 60-year business career, Trump has dabbled in a remarkable breadth of industries. They range from skyscrapers and golf courses to airlines and a university. The former president, who is currently mounting a third consecutive bid for the Oval Office, has also sold a wide range of branded products, including Trump vodka, Trump steaks, and even a line of Trump mattresses.
Yet his greatest impact has arguably been felt in the New Jersey casino industry. Trump loomed large over Atlantic City during the 1980s, 1990s, and 2000s. At his peak, he employed thousands of people and welcomed high-profile celebrities to the city, but his legacy was ultimately tarnished by multiple bankruptcies.
It begs the question: did Trump help or hinder Atlantic City’s casino industry? We have explored his checkered history in AC and explained why he remains a polarizing figure to this day.
Trump’s rapid rise in Atlantic City
Trump made his first foray into Atlantic City in May 1984, when Harrah’s at Trump Plaza opened for business. The complex featured a 60,000 sq. ft. casino, a 614-room hotel, and seven restaurants, all located on a narrow plot of land next to Caesars Atlantic City.
Five months later, the name was changed to Trump Plaza. At the time, the Harrah’s brand was associated with casual gamblers, who enjoyed visiting Harrah’s Marina. Trump wanted to attract high rollers, so he decided to rebrand the resort. The partnership between Trump and Harrah’s soured, and he eventually bought out Harrah’s interest in the property for $70 million in 1986.
By that point, Trump had already acquired a second property in Atlantic City. He snapped up the Atlantic City Hilton in 1985 and turned it into Trump Castle. The venue, which was later renamed Trump Marina, catered to a wealthy clientele, although its financial results were mixed.
Meanwhile, Trump bought a controlling interest in Resorts, and he eventually became the corporation’s chair. His most ambitious project was the Trump Taj Mahal, which opened to great fanfare in 1990. It was promoted as the “eighth wonder of the world,” and it was certainly the largest and most extravagant resort in Atlantic City at the time. The gaming space stretched to 120,000 sq. ft., featuring a huge variety of slots and table games.
Financial struggles and bankruptcies
Trump’s influence peaked in the 1990s, when the Taj Mahal was the highest grossing casino in the city. He brought glitz and glamor to Atlantic City, hosting concerts, boxing matches, and events featuring renowned celebrities. That boosted the city’s profile as a gaming and entertainment destination to rival Las Vegas.
However, Trump was heavily reliant on junk bonds to finance the Taj Mahal project, and the debt load ultimately proved unsustainable. His Atlantic City casinos became plagued by financial issues, which were attributed to over-leveraging, management issues, and increased competition.
Borgata opened in 2003, replacing the Taj Mahal as Atlantic City’s highest grossing casino. A year later, the Pennsylvania Race Horse Development and Gaming Act was passed, dealing Atlantic City a major blow. The act allowed racetracks in Pennsylvania to offer slot machines, turning them into racinos. Atlantic City casinos depended on visiting Pennsylvanians for a large chunk of their revenue, and that trade dried up after casinos opened in the Keystone State.
Trump’s casino resorts filed for bankruptcy multiple times between 1991 and 2009. They struggled to generate enough revenue to cover the debts incurred. His personal finances were somewhat shielded from the Chapter 11 restructurings, but he was eventually forced to reduce his ownership stake in the casinos bearing his name, as creditors took control of the assets.
Trump cuts ties with Atlantic City
The Taj Mahal closed in 2016. By that point, Trump had divested most of his interests in Atlantic City, and he was busy gearing up for the presidential election.
In 2021, the former Trump Plaza was demolished. That was a symbolic moment, as it marked the official end of his presence in Atlantic City.
The city may never return to the height of its popularity in the 1990s, as it faces increased competition from major resorts in Pennsylvania. However, revenues remain steady, and AC is working hard to promote itself as a gaming and entertainment destination in the post-Trump era.
What is Trump’s legacy in Atlantic City?
Trump’s Atlantic City casinos were initially viewed as bold and ambitious. He deserves credit for raising the city’s profile and helping it emerge as a popular tourist destination, but his achievements were marred by the subsequent financial struggles his casinos faced.
The good
High-profile ventures like Trump Plaza and the Trump Taj Mahal brought media attention, attracted visitors, and ramped up investment in the city. He arguably played a greater role in shaping the economic trajectory of Atlantic City than anyone else in the 1980s and 1990s.
At their peak, Trump’s casinos employed thousands of people and gave the city a major economic boost. Related industries, such as construction and tourism, benefited from his ambitious projects.
Meanwhile, the Trump Taj Mahal remains a bold architectural achievement. It was one of the largest casinos in the world, and its scale and opulence really pushed boundaries in terms of luxury and entertainment, setting a new standard for what casino resorts could achieve. That laid down the gauntlet to developers in cities like Las Vegas and Macau, and they responded by building iconic venues like Bellagio, Venetian, Wynn, and Encore in the ensuing years.
The bad
However, there are also several negative aspects of Trump’s legacy in Atlantic City. The frequent financial restructuring of his debt-laden casinos caused disruption for creditors, contractors, and employees, and it may have damaged Atlantic City’s reputation as a stable business environment.
His ambitious expansion into the city also contributed to market saturation. There were eventually too many casinos competing for a relatively limited pool of potential customers. This led to a decline in profitability for other operators in the city.
While many see Trump Taj Mahal as a towering architectural triumph, certain analysts retort that Trump’s approach prioritized grandiosity over sustainable financial planning. That ultimately may have contributed to the downfall of his own casinos and the wider economic malaise the city found itself in.
The ugly
By the time the Trump Taj Mahal closed in 2016, various residents and local officials felt that Trump had left the city in worse shape than it was in when he arrived.
While he cannot be blamed for some of the broader market conditions that led to the city’s decline, such as the advent of casino resorts in Pennsylvania, many still felt the city’s reputation was tarnished by his involvement.
Atlantic City has struggled to recover from the financial wreckage left by the bankruptcies. The jobs created by Trump’s projects eventually disappeared, and his name still stirs anger in the city.
Conclusion
In the short-term, Trump helped Atlantic City. He put it on the map, brought in tourists, created jobs, and ushered in a construction boom.
However, in the long-term, many would argue that Trump’s approach hurt Atlantic City. The financial instability and repeated bankruptcies ultimately tarnished the city’s reputation.
Trump’s casinos were initially symbols of success, but they soon came to embody the decline of the city. As other casino markets opened up in neighboring states, AC found itself struggling to compete. That could be down to financial and reputational damage suffered in the wake of failed ventures from Trump and other developers.
His forays into Atlantic City ultimately serve as a cautionary tale. They highlight the risks of overexpansion and leveraging high levels of debt to fund grandiose projects. In some ways, they reflect the peaks and troughs of Trump’s colorful career as a serial entrepreneur, and they are also emblematic of the boom-and-bust nature of Atlantic City’s economy.
More about New Jersey gambling
Sources
- Trump Assured Casino License; One Snag is Left
- Trump’s Ties to an informant and FBI agent reveal his mode of operation
- How Donald Trump Bankrupted His Atlantic City Casinos, but Still Earned Millions
- How Trump’s Debt Addiction Crushed the Biggest Company He Ever Ran
- Some in South Jersey have a message for Trump: Pay your old Atlantic City casino bills
- Trump Taj Mahal to Close in New Jersey, Union Demands at Fault, Say Owners
- Trump’s casino was a money laundering concern shortly after it opened
- Golden Nugget Parent Buys Trump Atlantic City Casino
- The last hand: The epic bust of Atlantic City’s gambling economy
- Atlantic City casinos look to future in face of growing competition
- Atlantic City Continues to Recover from ‘Lost Decade’
- Gov. Murphy Signs Atlantic City Casinos PILOT Bill, Setting Stage For Potential Legal Challenges
- Atlantic City Casino July Revenue Up From June, Down For Second Straight Year
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