MGM lands in Atlantic City 35 years later

MGM lands in Atlantic City 35 years laterMGM is on its way to Atlantic City as a casino operator more than 35 years later than many people expected it to arrive.

MGM’s original Atlantic City plan called for the company to combine with Hilton and Harrah’s in a complex that, well… never happened. Things unexpectedly went sideways, which is sometimes the fate of big plans.

Last week’s announcement that MGM is buying the 50 percent interest of its joint venture partner Boyd Gaming in the Borgata lacked a bit of historical perspective.

That’s understandable… attitudes can change in a hurry, kind of like a Donald Trump policy statement and public relations people are seldom inclined to linger over old history.

Atlantic City is no longer the place it used to be as a center of casino action. The opening of Resorts International in May 1976 yanked the aging oceanside resort town off its death bed and gaming executives with every company in the casino business were running over each other looking to get in on the action.

Resorts was making money faster than it could be counted amid grim predictions the brisk pace of activity might create grounds for concern about the future health of Las Vegas.

But even though the explosion of spending was being cheered, East Coast casino regulators were taking long, hard looks at some of these Las Vegas old timers. They did not like what they saw, frowning at the notion of licensing casino operators and owners who had been active in what was thought of as “old Las Vegas.” A number of respected and successful Las Vegas operators found the door closed to them in Atlantic City.

Former Caesars World founder Clifford Perlman is just one example. The late and much respected (in Nevada) Jackie Gaughan almost fell victim to the uptight attitudes that characterized much of the New Jersey process. But a full court press by his Nevada friends was successful in getting Gaughan approved as a principal player in the Atlantic City Showboat.

At various times in the 1980s Nevada officials seemed intent on giving license applicants from New Jersey the same rough treatment Nevadans had received in New Jersey.

There were unofficial indications Donald Trump would have faced some troubling questions should he apply for a Nevada license. Whether or not that was true, Trump never followed through on his promise to open a Trump casino on the Las Vegas Strip.

The late Kirk Kerkorian, who owned the biggest chunk of MGM at that time, did not want to play this game and so sometime in the latter part of 1980 he decided he would say thanks but no thanks to Atlantic City and the MGM plans were put back on the shelf, perhaps for later use.

His decision got little attention at the time because it roughly coincided with the November 1980 fire that destroyed the MGM in Las Vegas and it was widely assumed the fire was the reason the company abandoned its Atlantic City plans. There were two separate plans developed during later years to create an MGM in Atlantic City, but distractions always got in the way and MGM found other deals elsewhere.

The company tried to buy some Boardwalk acreage in the 1990s but one of the owners of Boardwalk land was not eager to sell. The company did not push too hard, CEO Terry Lanni confiding at the time that the delay allowed more time to carefully study casino possibilities elsewhere.

Attitudes began to change several years ago as New Jersey lawmakers and regulators got comfortable with the casino business, realizing how much it had done for Atlantic City.

Atlantic City’s future leans heavily on the willingness of casino owners to spend as MGM is doing. A few more Borgatas would make all the difference in the world.

Phil Hevener has been writing about the Nevada gaming business for more than 30 years. Email: 

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