Gaming analysts, casino exec offer insight

Thursday, Oct. 16, 1997 | 2:49 a.m.

"What's missing there now is the quality of builders," Joe Coccimiglio, gaming analyst for Prudential Securities, said during a panel discussion on the city's future.

Coccimiglio said Donald Trump is the leader in Atlantic City "and the quality of what he's built there pales in comparison to companies such as Mirage, the premier builder in the industry."

The highly publicized battles between Mirage Resorts Inc. Chairman Steve Wynn and Trump, who's trying to block Mirage's development of the H-Tract in Atlantic City, is confusing investors, analysts said.

"Uncertainties create risk profiles for investors," said Bear Stearns gaming analyst Jason Ader. "It's really unfortunate there've been delays on the H-Tract development, which could help everyone in that market."

"The infighting adds to the concern investors have about this industry," said Deutsche Morgan Grenfell analyst Jim Murren.

"Trump doesn't have the product to compete with Las Vegas, and it was transparent what he was doing," said Rodman & Renshaw analyst Danny Davila said. "It was unfortunate that some Atlantic City officials allowed themselves to be bullied there," he said of Trump's legal efforts to block the project.

In a later session, Murren and MGM Grand Inc. Chairman Terry Lanni talked about the area's potential.

"The properties there now are dull at best and pathetic at worst ... due to a lack of imagination by the builders," Murren said. "When you bring companies like MGM and Mirage into the market, that will change.

"Right now, Atlantic City operators are competing on price, which is bad for the profit-and-loss statement," the analyst said. "The couponing there is unforgivable, and Donald Trump has been the leading culprit. MGM, Circus and Mirage won't market that way."

The three major Las Vegas companies have announced plans to expand to the Atlantic City market.

Atlantic City casino operators have offered coupons, other discounts and cash incentives to buy customers, a move criticized by analysts.

"Atlantic City needs new operators more than they need Atlantic City," Murren said. "If these companies don't come, Atlantic City is in a lot of trouble."

Lanni said improved regulatory and political climates "have created an atmosphere for the renaissance of Atlantic City." But he criticized the current casinos, saying, "If you take off a few minarets and the like, the buildings would look like Sears Roebuck distribution centers.

"We want to develop emotionally engaging destination resorts that make people want to return time and time again," he said.