ATLANTIC CITY — A new casino may rock Atlantic City out of its economic doldrums.

Hard Rock International, one of the best-known brands in the gaming and entertainment industry, announced tentative plans Tuesday to develop one of its signature music-themed casino hotels on the Boardwalk.

The company said it has formed a partnership with the New York-based investment group Och-Ziff Real Estate for a $300 million project at the foot of the city’s Route 40 entryway.

The gaming property would include a luxury hotel, upscale restaurants and entertainment attractions, a beachfront pool and a spa. The number of hotel rooms would be determined later.

But Hard Rock stressed that its project largely depends on approval of proposed state legislation that would allow for construction of four smaller, less expensive casinos in Atlantic City. The Florida-based company has been playing with the idea of building in Atlantic City for some time, but said the new legislation would allow it to develop a casino at a greatly reduced cost.

“We are intrigued by the newly proposed legislation, which makes entering the marketplace more manageable,” Hard Rock International Chairman Jim Allen said. “Despite current headwinds, Atlantic City remains the second-largest gaming market and would be an exciting location for a Hard Rock Hotel and Casino.”

State Sen. Jim Whelan, D-Atlantic, introduced legislation Monday that would lower the requirement for casino-hotel construction from the current minimum of 500 rooms to just 200. Whelan, a former Atlantic City mayor, will have to overcome objections from Republican opponents and some of the current casino operators to get the bill approved.

“I’ve talked to the leadership on both sides of the aisle and in both houses,” Whelan said, aiming for bipartisan support. “There are people who support it and some who have reservations about it. As we work through the process, we hope we can address any concerns.”

Whelan said he had been discussing the casino project with the Hard Rock group for months, but decided to introduce the legislation when the company’s plans grew serious.

“No one has gotten to the level of being where Hard Rock is,” Whelan said.

Mark Juliano, chief executive officer of the three Trump Entertainment Resorts Inc. casinos, has denounced Whelan’s bill as a “ludicrous” idea that would cheapen Atlantic City’s image and undermine efforts to develop a more high-end tourism market.

Don Marrandino, president of the Bally’s, Caesars, Harrah’s Resort and Showboat casinos owned by Harrah’s Entertainment Inc., said his company will consider giving its support to the legislation if it is a catalyst for nongaming amenities that would enhance Atlantic City’s visitor base.

“If someone came up with some really cool stuff — like the exhibit of aquariums at Mandalay Bay in Las Vegas, or a shark tank or amusements or big concerts — then I think we would take a look at it,” Marrandino said. “But if they came in with just 200 hotel rooms and a casino, we wouldn’t be interested in it.”

Whelan’s legislation is part of efforts to revive Atlantic City’s gaming industry, now mired in a three-year slump caused by the fragile economy and competition from Pennsylvania’s slot parlors. His bill would lead to a new generation of cheaper, boutique-style casinos, making it much more affordable for developers to build.

Allen emphasized the importance of the legislation for Hard Rock’s project. He also said the company is attracted by New Jersey’s historically low casino tax rate and the potential gains for the Atlantic City market once the economy recovers.

“We really do believe in the market,” Allen said. “We believe there is a lot of upside.”

Hard Rock International, which operates 13 casino hotels and 130 cafes around the world, is one of the most recognized brands in the entertainment business. The company’s extensive collection of music memorabilia is displayed in its clubs and casinos. The Seminole Indian tribe in Florida owns the Hard Rock empire.

If built, Hard Rock’s Atlantic City casino would rise at the southern end of the Boardwalk, at the Albany Avenue terminus of the Route 40 corridor. Years ago, the property was the site of the ill-fated Dunes casino, which was torn down after the developer went bust during construction.

Hard Rock would operate the casino and the Och-Ziff investment group would finance it, Allen said. Och-Ziff is a private equity fund that has nearly $25 billion under its management. It owns the development site as part of an investment group that includes hotelier Curtis Bashaw. The Hard Rock casino would take the place of a $2 billion megaresort that Bashaw had once hoped to build, which was stopped cold by the recession and global credit crisis.

Bashaw has tentative plans for another casino project linked to the Whelan proposal. The legislation also raises the possibility of existing noncasino hotels being converted into boutique casinos. Bashaw is thinking of converting his posh Chelsea hotel, which overlooks the Boardwalk at Chelsea and Pacific avenues, into a casino hotel.

Contact Donald Wittkowski:
609-272-7258
DWittkowski@pressofac.com