Tropicana Entertainment Buys Chelsea Hotel in Atlantic City
- Jul 11, 2017
What a way to grow. Tropicana Entertainment Inc. will expand Tropicana Casino & Resort Atlantic City, a 24-hour gaming destination with 2,400 guestrooms and a 200,000-square-foot entertainment complex, by 300 keys and it will do so without lifting a shovel. Acting through its Tropicana Atlantic City Corp. subsidiary, the company recently purchased The Chelsea Hotel, sited just across the street, and will connect the boutique lodging property to the complex via a skyway bridge.
Tony Rodio, president & CEO of Tropicana Entertainment, said in a prepared statement that the acquisition affords Tropicana “the opportunity to offer our guests more hotel room options on The Boardwalk.”
The Chelsea made its debut in 2008 as Atlantic City’s first boutique hotel, the product of the $30 million transformation and conjoining of a Holiday Inn and a Howard Johnson hotel at the hands of Cape Advisors Inc. and Normandy Real Estate Partners. Tropicana will reintroduce the property, which has been closed since December 2016, as The Chelsea Tower at Tropicana Atlantic City, increasing Tropicana Atlantic City’s total number of hotels to five.
The Chelsea Tower will be opening its doors at a time when the performance of hotels without gaming space are on the upswing. As of March 2017, year-over-year RevPAR increased in the non-casino segment by 8 percent, according to a report by the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism.
Good support system
Less than a decade ago, Tropicana was in no position to expand; the company emerged from bankruptcy in 2010. Since then, however, the casino and resort owner has been buoyed by Icahn Enterprises LP, which owns a 68 percent majority interest in Tropicana.
The purchase of The Chelsea, as opposed to a full-fledged hotel casino in the area, dovetails with goals expressed by Icahn Enterprises in March 2017, when the diversified holding company entered into an agreement to sell the former Trump Taj Mahal Casino Resort in Atlantic City. In prepared remarks on the planned sale, Carl Icahn, chairman of Icahn Enterprises, said, “We at IEP are extremely happy with our ownership of the Tropicana Casino & Resort, and after considerable analysis and deliberation we determined that we only wanted to own one operating casino property in Atlantic City.”
Chelsea Tower will open this August.