Casino and hospitality group Hard Rock Cafe International Inc. led a group of investors to purchase the Trump Taj Mahal Casino Resort, formerly belonging to the President Elect of the United States, in Atlantic City, according to a company release.
Hard Rock International will be the majority shareholder in a US$300 million (MOP2.4 billion) operation to ‘purchase, substantially renovate and re-open’ the property as Hard Rock Hotel & Casino Atlantic City.
The development will be undertaken in partnership with the families of developers Jack Morris, the CEO of Edgewood Properties, Joseph R. Jingoli, Jr. and Michael D. Jingoli, of Jingoli Construction and DCO Energy.
“We are excited to be part of this revitalisation of Atlantic City creating thousands of jobs to help local employment. We are 100 per cent convinced Hard Rock Hotel & Casino Atlantic City will be a success,” stated Jim Allen, chairman of Hard Rock International.
Hard Rock International operates the Hard Rock Hotel in Macau at Melco Crown Entertainment Ltd. property City of Dreams Macau casino resort in Cotai.
Together with the two investors from the U.S. state of New Jersey, Hard Rock International reached a deal to purchase the property for an undisclosed amount with billionaire Carl C. Icahn, chairman of Icahn Enterprises and owner of the Tropicana Casino & Resort in Atlantic City.
The release by Icahn Enterprises stated the company purchased the Trump Taj Mahal Casino Resort in February 2016 following the bankruptcy of Trump Entertainment Resorts Inc., with the property ceasing its casino and hotel operations eight months later.
Mr. Icahn stated previously he had lost US$300 million owning the Taj Mahal and would be delighted if he could sell it for half that amount, AP reported.
The sale deal does not include the former Trump Plaza Hotel and Casino in Atlantic City which is also owned by Icahn Enterprises, with the company currently only owning the Tropicana Casino & Resort in the city.
“A sale of the Taj Mahal therefore represents the optimal outcome for us. We wish Hard Rock and its partners the best of luck with the Taj Mahal,” said Mr. Icahn in the release.
A turbulent story
Inaugurated in 1990, the Trump Taj Mahal Casino Resort construction cost almost US$1 billion, with reports then stating Trump owned US$750 million in debt on the property, leading the now U.S. President to announce a prepackaged bankruptcy only one year later.
Half of the property’s shares were handed to bondholders, with Trump’s group Trump Hotels & Casino Resorts buying the property in 1996.
After filing for bankruptcy of its Trump Hotels & Casino Resorts, Trump stepped out of the gaming business in Atlantic City, with the group being purchased by Mr. Icahn last year.
A union strike in July 2016 demanding benefits cancelled after Trump Entertainment went bankrupt caused a series of financial losses that led Mr. Icahn to close the property.
With 3,000 workers currently unemployed the new project is only expected to open in the Summer of 2018, AP reported.