Trump plans new Atlantic City casino on site of Trump World’s Fair

Friday, July 9, 1999 | 12:19 p.m.

Donald J. Trump, who has amassed a casino empire here by buying other people's buildings, now plans to build one of his own.

Trump announced Friday he will demolish his money-losing Trump World's Fair casino and build a new one on a 12-acre Boardwalk site next to Convention Hall.

"Clearing away the World's Fair will give us the flexibility to develop the kind of world-class signature property that has made the Trump Organization the dominant developer in New York," his company, Trump Hotels & Casino Resorts, Inc., said in a statement. "We are going to bring the magic of Manhattan to the Boardwalk."

The casino hotel, which could have up to 4,000 rooms, would cost about $750 million. Construction could begin in early 2001, Trump Hotels CEO Nicholas L. Ribis said.

Trump World's Fair, a 21-story building that was built as a Playboy casino, was bought by Trump for $63 million in 1989. He operated it as a non-casino hotel, Trump Regency, before pumping $48 million in renovations into it and reopening it in 1996 as Trump World's Fair.

But it has always struggled, losing about $10 million a year. The casino will be closed later this year in preparation for demolition, which will cost between $3 million and $5 million, Ribis said.

"I think it's a good move," said Bear Stearns casino analyst Jason Ader. "They're not making money there. It's costing them money. This gives them the ability to assemble a great site in Atlantic City."

Trump promised a project "fully planned, conceived and developed" under his direction, but he may need a joint venture partner to finance it.

The company's $1.8 billion in junk bond debt has hindered its earnings and kept stock prices low. Trump Hotels last year lost $39.7 million on revenues of $1.4 billion.

"They're a very leveraged company, so their financial flexibility is limited," Ader said. "They wouldn't be able to go out and borrow a significant amount of capital. But next year, they could go out and refinance a significant portion of their debt. Given the current state of the company, it'd be difficult to do a $1 billion project."

Ribis said a joint venture was possible but would not say who Trump was courting, if anyone.

Trump Hotels owns Trump Taj Mahal, which was originally built by Resorts International; Trump Marina, which was built by Hilton Hotels Corp., and Trump Plaza, which was developed in partnership with Holiday Corp.

Trump World's Fair, which opened in 1996, is considered an extension of Trump Plaza and operates under its license.

Trump also owns a Gary, Ind., riverboat casino and has agreed to buy the Flamingo Hilton riverboat casino in Kansas City.

"The new property will incorporate the best of everything we have ever developed before," Trump said. "Our existing Atlantic City casino hotels were principally designed by others or with partners. They are great properties. But they do not fully reflect a Trump signature property. We are going to take the best features from each and incorporate the unique style which distinguishes our New York projects from all the others," he said.