“We are extremely excited about the proposed investment by the Ilitch organization, which, if approved, will give Ocean access to growth capital and provide a strategic partner to Luxor,” the hedge fund said Tuesday in a news release announcing the partnership. “We look forward to continuing to grow Ocean in partnership with the Ilitch organization for years to come.”
According to the New York City-based hedge fund, the deal with the investor is already sealed, though the New Jersey Division of Gaming Enforcement (DGE)will have to authorize the deal before it becomes official. A report from the Associated Press indicates that Ilitch has already sent in applications for interim approval to own part of the casino.
Luxur gained control of Ocean back in 2019 from Bruce Deifik. The late Colorado-based investor had reopened the casino in the summer of 2018, raising it from a shuttered state to a luxury resort. The casino, which was named Revel Casino Hotel, had closed in 2014 after only two years of operation.
Luxur took control of the property after several months of poor revenue reports. The hedge fund then gained licensing approval in May 2020. With this fund, the management invested up to $70 million in a bid to improve the casino. The money was mostly used to cut down debt and boost the attractiveness of the resort.
Since the takeover, Ocean’s Casino revenue reports have significantly improved especially from its table games and slot machines. In comparison with the nine casinos in Atlantic City, Ocean now ranks in the third position just behind Borgata and Hard Rock Hotel & Casino. It was initially in the sixth position.
In the press release, Luxor stated that “the Ilitch organization recognizes the success that the team at Ocean has achieved over the past two years,” and “looks forward to …building on their accomplishments through continued investment in both the property and the customer experience.”
Ocean In the iGaming Market
Though Ocean has seen success in other areas, it is yet to establish itself in the online gambling market.
The Covid-10 pandemic forced AC’s casinos to shut their doors for almost four months in 2020 which gave online gaming the chance to grow. Revenue grew up to 101% over 2019 up to $970 million.
Unfortunately, the big figures are not in Ocean’s favor as it reported slightly above $10 million from iGaming in 2020. Its offers are just Parx online casino and an Ocean-branded app which don’t really match what its competitors offer in the market.
However, the casino’s retail sportsbook recorded huge success, ranking as the 3rd highest performer in 2020 just behind Borgata and Tropicana. The William Hill Sportsbook at Ocean recorded over $1.3 million in revenue in 2020.
If Ilitch gets authorized by NJ gaming regulators, it will greatly impact the game offers at William Hill Sportsbook. However, NJ’s sports betting law prevents owners of sports teams or investors from offering betting lines at casinos they own. This means the Detroit Red Wings and the Detroit Tigers owned by Ilitch won’t be available at Ocean’s sportsbook. The scenario also plays out at Golden Nugget Atlantic City. The casino is owned by Tilman Fertitta who also owns the NBA’s Houston Rockets.