Like many before him, Sheldon Gordon came to Atlantic City, N.J., confident that he would win big. Standing on a glass walkway between his new beachfront shopping mall and Caesars casino, he surveys a boardwalk full of people on a humid June afternoon and says, "There's no mall in America that has this amount of traffic on a Monday." If he were playing poker, Gordon's face would be a dead giveaway: he is obviously quite happy with his hand. At the end of the walkway is the Pier, a $210 million green glass complex holding 90 shops, 10 restaurants, two nightclubs, a wedding chapel and a three-story, $8 million water-and-light show. "This is going to dramatically change Atlantic City," Gordon says.
It's about time. Real estate developers and casino companies are plowing billions of dollars into low-rent Atlantic City--known for day-tripping seniors, nickel slots and giveaway buffets--in an attempt to reinvent the resort town as a Las Vegas--style destination packed with shows, shops and celebrity chefs. The folks in Jersey see no reason why Vegas should have a lock on garish spectacle and conspicuous spending.
Last week the first stores in the Pier opened, as did a $200 million expansion of the Borgata casino hotel that includes restaurants by star chefs Wolfgang Puck, Bobby Flay and Michael Mina. "People want to do more than gamble," says Pam Popielarski, president of the Tropicana casino hotel, which opened its complex of stores, restaurants and IMAX movie theater, dubbed the Quarter, in late 2004. "They want entertainment."
It wasn't until the 1990s that Las Vegas figured out that people couldn't gamble 24 hours a day and that despite the house's best efforts, they still had disposable income to spend outside the gaming halls. Gordon was there when blackjack met Louis Vuitton and Cirque du Soleil. His Forum Shops at Caesars Palace were a catalyst for transforming Sin City into Shop City; today those stores are among the top grossing in the country on a dollars-per-sq.-ft. basis.
Atlantic City toyed with a similar move for years but couldn't give up its profitable day-tripper business model. Yet the opportunity was evident. Last year tourists made about as many visits to Atlantic City as to Las Vegas (34.9 million, vs. 38.6 million) and spent a comparable amount of money gambling--$5 billion at Atlantic City's 12 casinos, vs. $6 billion at the 42 casinos on Vegas' Strip. But the Strip's casinos brought in an additional $6.9 billion from nongambling sources, while Atlantic City's drew just $1.3 billion. All in, tourists dropped $36.7 billion in Vegas; Atlantic City's take was one-fifth of that. Billions, it seemed, were being left on the table.
A mix of tax breaks for nongambling development, the competitive threat of slots in neighboring states and the 2003 opening of the first new casino in 13 years finally kick-started the city. Borgata, with its scantily clad cocktail waitresses and $150 dinners, raised the ante for the industry. "It's kind of like when Steve Wynn opened the Mirage," says chef Flay, referring to Vegas' first megacasino, which opened in 1989. After Wynn made a volcano, everyone built over the top.