Monopoly on the Boardwalk

Lots of other players are still struggling to pass Go

When the doors open at 10 each morning, the hopeful come crowding into what looks like a hall of mirrors, jostling for places at gambling tables and slot machines that seem to stretch to infinity. Grimly determined to beat the odds, the players have been pouring huge amounts of money into the casino's coffers. This is Atlantic City, and it is booming beyond the most optimistic expectations.

When Resorts International opened its football-field-size casino in May, gamblers lost an average of $438,500 a day on the tables and machines. By June the daily drop reached $535,000, and security analysts estimate that the figure is now running as much as $700,000 a day, three times the revenues of either Caesars Palace or the MGM Grand, the biggest casinos in Las Vegas.

The people who are becoming rich are the stock market players: Resorts International's stock soared from $20 a share in March to a recent high of $96 1/2. The company has invested some of its new capital by purchasing the Seeburg line of slot machines and Atlantic City's famed Steel Pier. The shares of two other firms that plan to open casinos in Atlantic City are also rising fast: Bally Manufacturing Co., which makes slot and pinball machines, from a low earlier this year of $15 to $38 last week, and Caesars World, from a low of $6 earlier this year to $25 last week. Says Wall Street Analyst Anthony Hoffman: "Americans will gamble wherever they can. Why is just $75 billion bet in the country each year? Only because there aren't enough opportunities."

Caesars World has leased, for $2.5 million a year, the Howard Johnson's Regency Motor Lodge and plans to spend $30 million on renovations and a casino that will be 50% larger than Resorts International's. The gamblers' chips may be down by early next year. Japanese Restaurant Tycoon Rocky Aoki, president of the Benihana chain, and Financier Takashi Sasakawa have leased the old Shelburne Hotel for more than $1 million a year and are rushing to remodel it into a casino by spring. Further behind is Bally Manufacturing, which has leased a baroque landmark, the Marlborough-Blenheim Hotel. The company wants to tear it down, despite its entry in the National Register of Historic Places, but a local group intends to fight the plan in court.

Such problems have not been encountered by Golden Nugget Inc., of Las Vegas, which proposes building a new $75 million high-rise casino-hotel on the site of an old stucco motel. Golden Nugget's hard-driving president, Stephen Wynn, last month slipped into the motel wearing sandals and a T shirt. When the owner quoted an $8.5 million selling price, Wynn replied: "I'll give you a million now and the rest in 24 hours." Wynn told reporters that the owner was so surprised "he almost dropped dead." Also scrambling to open casinos are Playboy Enterprises, which plans to build a new hotel, and Penthouse International, which has acquired the Four Seasons Motel and Holiday Inn on the Boardwalk.

The state of New Jersey is cashing in on the boom too, by means of a casino tax that skims about 8% of the house's winnings. The state originally projected that the tax would bring in $18 million a year by 1980, when four or five casinos are expected to be operating. But the daily take at Resorts International is already high enough to bring in that amount of taxes a year.

Some law-enforcement officials fear that the river of revenue will weaken the state's resolve to follow stiff screening procedures to prevent criminals from infiltrating casino operations. Says a cynical detective: "The continuity of revenue is important to state officials. They will not shoot Santa Claus." Resorts' license, in fact, was granted on a temporary basis, at the urging of Governor Brendan Byrne and over the objection of the state's gaming enforcement chief, Robert Martinez, whose agency still has not completed its investigation of the company.

A potential casino owner certain to be the subject of scrutiny is Morris Shenker, who put up $10 million to buy the President Motor Inn on the Boardwalk. Formerly one of Jimmy Hoffa's lawyers, he is part owner of the Dunes Hotel and casino in Las Vegas. Because of Shenker's links with a scandal-ridden Teamsters Union pension fund, he has been investigated off and on for more than 20 years by the Internal Revenue Service, the Securities and Exchange Commission, the Justice Department and the Nevada gaming commission. Mob activity in Atlantic City has so far been concentrated on loan sharking and the control of service businesses such as laundries, vending machines and garbage collection.

The emerald tide in Atlantic City, the only U.S. city outside Nevada that permits casino gambling, has not escaped the attention of other states. A group called Let's Help Florida, which hopes to rejuvenate decaying Miami Beach with casino gambling, claims to have enough voters' signatures to hold a referendum on the issue this November. But Governor Reubin Askew is organizing a statewide campaign to fight the proposal. The New York legislature has approved a state constitutional amendment to allow casinos. If the same measure is approved a second time, next year, as required by state law, the amendment will be on the ballot next year.

But legalized gambling is not transforming Atlantic City as fast as some residents had expected. Except for the crush inside the Resorts International Hotel and the wild bidding in real estate offices for Boardwalk property, the city is still much the same as always. Earlier this year, many home and shop owners posted FOR SALE signs in hopes of making quick fortunes. But much of the opening-day hysteria has passed, and rents of property not on the Boardwalk have returned to normal. Indeed, some residents joke that the city's best chance of getting new money out of the casinos and on to the streets rests with a movement organized by a women's rights activist and a former Atlantic City madam. They have formed a group called HUSH (Help Undo Sexual Hypocrisy) that is trying to legalize prostitution. -

This file is automatically generated by a robot program, so viewer discretion is required.