Atlantic City delays tied to cost concerns

Tuesday, Jan. 18, 2000 | 11:25 a.m.

THE ASSOCIATED PRESS

ATLANTIC CITY -- Five years after announcing plans to build a huge resort casino in Atlantic City, Las Vegas-based Mirage Resorts Inc. has yet to substantially move on the project -- delays that analysts say are triggered by a desire to remain on budget.

The Press of Atlantic City reported that Mirage still hopes to build a 1,150-room, three-hotel property in Atlantic City, themed after 19th Century France. But analysts say Mirage Chairman Steve Wynn is targeting a pricetag of no more than $1 billion -- about half the cost of many original estimates.

"I think (Wynn) wants to be extra cautious in announcing a budget they can stick to and not exceed, because they went way over budget for both Beau Rivage and Bellagio," said analyst Joseph Coccimiglio of Prudential Securities. "(Wynn's) gotten some religion from shareholders who were very upset about overruns and he wants to build a project that he can add to if he's successful."

Beau Rivage is a Mirage resort in Biloxi, Miss. Bellagio is a resort in Las Vegas that Mirage may expand because of strong demand.

Mirage spokesman Alan Feldman told the newspaper that the company was still committed to the project, but that he didn't know what the timeframe for construction was.

The city has already approved a $330 million tunnel-roadway that will lead to the site. Under its agreement with Atlantic City, Mirage has until Oct. 31 to secure all permits for the site. The company has yet to file any construction applications.

The project has been long anticipated by Atlantic City officials, who hope it could trigger the same kind of transformation that Wynn's Mirage hotel-casino launched in Las Vegas in 1989. But without any new casino construction, city officials say they will have to raise taxes this year, possibly as much as 7 percent.