Posted on: February 28, 2022, 01:06h.
Last updated on: February 28, 2022, 01:07h.
Borgata Hotel & Casino in Atlantic City was recently appointed a new boss. And the freshly minted president has big plans in store for the MGM Resorts property.
MGM last month promoted Travis Lunn to the position of Borgata president. He previously oversaw the company’s Mississippi casino resort operations at Beau Rivage in Biloxi and Gold Strike in Tunica.
The Borgata position comes with much more prestige, as it’s MGM’s most important US casino asset outside of Las Vegas. The Atlantic City casino in pre-pandemic 2019 generated net revenue of $817 million. Beau Rivage and Gold Strike collectively reported net revenue of $620 million that same year.
Lunn arrives in New Jersey with big plans for Borgata. During an interview with the Associated Press, Lunn revealed that he’s already been handed $10 million in renovation funds from MGM to overhaul the Marina District casino and resort.
Keeping Up with the Competition
Lunn says a large chunk of the $10 million budget will go towards updating the casino’s slot machines.
“Our guests come in looking for a certain gaming experience, and we currently don’t offer some of the product that our competitors offer,” Lunn explained.
Borgata’s main competitors are Hard Rock and Ocean Casino. Both Boardwalk casinos actively target Atlantic City’s premium player demographic. Ocean and Hard Rock have put a dent in Borgata’s longtime dominance of the Atlantic City casino industry.
In 2019, Borgata reported brick-and-mortar gross gaming revenue (GGR) of $709.5 million — or roughly 26% of the entire land-based Atlantic City gaming market. That same year, Hard Rock and Ocean Casino respectively won $324 million and $215.6 million.
In 2021, Borgata’s retail slots and table games generated gaming revenue of $606 million — a nearly 15 percent decline from 2019. Borgata’s overall brick-and-mortar market share dropped below 24 percent.
Hard Rock and Ocean saw their GGRs greatly increase in 2021 from 2019. Hard Rock won $431.1 million and Ocean $306.8 million. Lunn claims to be pleased for Hard Rock and Ocean’s successes.
I think that’s a healthy thing for us, for the greater overall Atlantic City,” Lunn told the AP. “A rising tide carries all ships. I’m a believer in that.”
The new Borgata leader says the property’s 2,767 guestrooms need to be reimagined to offer unique amenities. The MGM executive says the goal of the hotel makeover will be to keep the resort “relevant and stay competitive.”
Much more than $10 million will be needed to accomplish that undertaking. But it’s an essential investment, Lunn believes.
[Hotel renovations are] a clear priority,” Lunn said. “As the market leader, we need to be best in class in our room product. Right now, we have quality, but are we relevant? Do we have the latest amenities inside our rooms? That’s on my short list.”
MGM brass in Las Vegas is betting on Lunn being able to turn Borgata around to business levels experienced prior to the arrival of the coronavirus.
In 2019, Borgata experienced a gross operating profit of more than $209.5 million. In COVID-19 2020, Borgata posted an operating profit of just $650,000. Through three quarters of 2021 (full-year numbers have not yet been released), Borgata’s operating profit stood at $57.2 million.