Credit Crunch Stifles Casino Construction

The troubled credit markets that are creating problems for home buyers, cities and other borrowers are also disrupting the capital-intensive casino industry — driving up construction costs and delaying, if not completely scuttling, projects.

In Pennsylvania, two would-be casinos in the Pittsburgh area are seeking special treatment from gambling regulators on grounds of economic hardship.

In New Jersey, developers of the $2 billion Revel casino and hotel in Atlantic City are seeking financial help from the city, which will consider floating bonds. And Pinnacle Entertainment Inc. is questioning whether it is wise to borrow money for its $1 billion-plus casino project on the site of the razed Sands Hotel Casino.

Casino companies have lost billions in market value. The falling share price of Penn National Gaming Inc. helped tank the nearly $6 billion purchase of one of the nation’s largest casino companies by a private equity firm last week.

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