Casino buying 12 acres once home to Chalfonte for undisclosed project
By JOE WEINERT

ATLANTIC CITY - Five months away from completing a $115 million hotel expansion, Resorts Atlantic City is developing plans for another major project next door.

The casino on Friday agreed to buy a 12-acre site it now leases for surface parking, Resorts officials said Wednesday. They did not reveal the price, but previous securities filings disclosed a $40 million agreement.

"We're planning something next door that I'm excited about but can't talk about now," Nicholas Ribis, Resorts' vice chairman and minority owner, testified before the Casino Control Com-mission.

"I'm a believer in Atlantic City. I think Atlantic City has a lot more to grow. ... The expansion of the marketplace is what has to happen. This (land purchase) gives us a clear field for us for development, which you will be hearing about in the next three to six months," Ribis said.

He would not disclose the project scope.

"Our best guess is that the new project includes additional gaming and hotel capacity and that it may be a joint venture with a somewhat higher-budget customer orientation than Resorts currently has. A rumor at the hearing was that a joint venture may include a Hard Rock casino hotel but we are not certain at this time," Jefferies & Co. analyst Raymond Cheesman said in a research note.

Resorts and site owner Kerzner International (Resorts' previous owner) expect to complete the sale within two weeks, pending commission approval.

A potential third project - rebuilding Steeplechase Pier - remains in the conceptual stage, Ribis said.

Resorts, the city's second-smallest casino hotel, has become financially potent since being acquired three years ago by Colony Capital, a private firm with more than $9 billion in real estate investments.

The casino commission took note of Resorts' financial strength Wednesday in renewing its casino license for four years.

Resorts has the resources to weather "any disruptions until it can begin to realize the hoped-for benefits from its most-welcomed investment in Atlantic City," commission Chair Linda Kassekert said.

Resorts is in the middle of a difficult year. Its profits have plunged due to the demolition of an older hotel tower 16 months ago and the opening of Borgata last summer.

"You'll see significant growth in (cash flow) in the second half (of this year) with the new rooms," Ribis predicted.

The 27-story Resorts tower was supposed to have 459 rooms but will open in June with only 399. It plans to complete the remaining rooms next year, when it determines whether they're best used as standard rooms or suites. Until then, they'll remain "shells" with the wiring and piping already in place, Ribis said.

The expansion also involves space for 700 more slot machines and 10 more table games and a conversion of its existing hotel lobby into a retail area, President Audrey Oswell said.

When the completed, Resorts expects to have 879 hotel rooms, 3,161 slots and 71 tables.

Resorts plans to begin marketing its new look in March. The casino is expected to change its name back to Resorts International - its name when it opened as the city's first casino 26 years earlier.

Resorts' 12-acre site was once home to the Chalfonte Hotel but over the last decade has been the site of failed casino dreams. Then-Resorts owner Merv Griffin in 1996 announced plans for a 700-room hotel tower, only to sell the company to Sun International Hotels (now called Kerzner International) later that year. Sun announced plans for a sprawling, water-themed casino resort called Atlantis. It later abandoned the plans and eventually sold Resorts to Colony.

To e-mail Joe Weinert at The Press:

JWeinert@pressofac.com