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Report finds encouraging signs in Atlantic City

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While casino revenue continues to dwindle, certain other tourism metrics from Atlantic City show improving trends.
While casino revenue continues to dwindle, certain other tourism metrics from Atlantic City show improving trends. - (Aaron Houston / NJBIZ)

Casino gaming numbers remain problematic, but tourism officials believe Atlantic City's transformation into a destination resort is becoming a reality.

That belief comes in light of the Atlantic City tourism performance indicators in the 2012 annual report from the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton College, in Galloway. According to the report, while casino revenue has declined in recent years, the dollar amounts spent on accommodations, shopping, food and drink establishments, entertainment, and transportation have increased.

"News media have primarily focused on declines in gaming revenue in Atlantic City, but that is far from the full story," said Brian Tyrrell, associate professor of hospitality and tourism management studies at Stockton. "Take gaming out of the equation … and we have a growing destination in all other facets of the tourism economy in Atlantic City."

The report primarily considers the hotel occupancy fee, luxury tax and casino parking fees. Tourists in Atlantic County spent $7.9 billion on goods and services in 2011, the highest of any county. Though the casino parking fee was 8.6 percent lower than 2009, it posted its first year-over-year increase in 2012.

"The resort is trending away from its casino-centric past to one that is more diverse, and attracting visitors who are staying longer and enjoying resort amenities like dining, shopping and entertainment," said Israel Posner, executive director of the Levenson Institute.

At $5.5 million, hotel occupancy in 2012 was 31 percent more than 2009. The luxury tax levied on hotels, alcohol and entertainment was $35.5 million, which was 34 percent higher than 2009. Both taxes were at record highs.

Hurricane Sandy clearly had an effect on hotel occupancy in the fourth quarter as displaced residents and recovery workers filled hotel rooms, making 2012 the strongest year on record for the Atlantic County lodging industry.

"Hotel occupancy in the fourth quarter of 2012 was clearly affected by Sandy and pushed 2012 to a record high, but the occupancy fee was up in 2012 and 2011, as well," Posner said.

Tyrell credits some of the increase in tourists to the Do AC campaign of the Atlantic City Alliance.

"The rise in these non-gaming tax collections and the Do AC campaign show strong parallels," he said. "People are eating out more, they are staying over more, and for the first time since Pennsylvania gaming began, we are seeing more folks parking at the casinos in Atlantic City. This is really good news."

Correction: The Do AC campaign is part of the Atlantic City Alliance. An earlier version of this story gave the incorrect agency.

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