Hard Rock Atlantic City to Pay Strip Club And Steak House Tenant $1M Annually Through 2032

Posted on: December 8, 2020, 10:34h. 

Last updated on: December 8, 2020, 12:15h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Hard Rock Atlantic City will pay a businessman who had two leases inside the Boardwalk casino resort $1 million annually through 2032.

Hard Rock Atlantic City casino resort
Hard Rock Atlantic City will pay the owner of the closed Scores and Robert’s Steakhouse a total of $13 million for terminating his leases. (Image: New York Post)

In January, Hard Rock Hotel & Casino settled a legal dispute that leaves the resort with a $1 million annual debt payable on the first of the year. The settlement is for 13 years, and with the first $1 million paid earlier this year. The contractual payments run through 2032.

The settlement is the conclusion of Hard Rock’s legal quarreling with businessman Robert Gans. Hard Rock terminated his two leases inside the property in January.

Gans’ ‘Scores’

Hard Rock revealed the $13 million settlement in its third-quarter financial filing with the New Jersey Division of Gaming Enforcement (DGE). The remaining 12 payments will be paid without interest through January 1, 2032.

The two tenants are entities controlled by Gans. The first, Scores, is a so-called gentlemen’s club with scantily dressed female entertainers. The second is Robert’s Steakhouse. Robert’s opened inside Taj Mahal in 2012. Scores welcomed its first guests the following year.

After Hard Rock acquired the shuttered Taj Mahal in 2016 from billionaire Carl Icahn for $50 million, the casino and hospitality company owned by the Seminole Tribe of Florida said it would seek to evict Scores from the property once it reopened.

Hard Rock International filed a federal lawsuit prior to Hard Rock Atlantic City’s June 2018 opening against Gans’ Scores. Hard Rock argued that allowing Scores to continue operating at its casino resort would sully its own brand and family-friendly reputation.

The case was eventually dismissed, and Scores and Robert’s both reopened along with Hard Rock more than two years ago. However, both businesses announced in January that they were closing. Their social media pages revealed that their leases were not being renewed by Hard Rock.

$13M to Leave

Hard Rock’s settlement with Gans shows just how badly the company did not want a strip club on its premises. While such entertainment is frequently sought by some gamblers, no Seminole-owned casino features a strip club or similar enterprise.

Hard Rock Atlantic City derives the majority of its revenue from gaming. In the three quarters in 2020, casino win generated $112.8 million, or 61 percent of the property’s $184.9 million total net revenue.

Hard Rock AC sold $27.2 million worth of rooms, $23.4 million worth of food and beverage, and $21.6 million filed away in the “other” category. Through nine months of the year, Hard Rock reported a net income loss of nearly $81 million.

Atlantic City’s nine casinos were forced to close March 16 on New Jersey Gov. Phil Murphy’s (D) orders. They were permitted to reopen 107 days later on July 2, but continue to operate at only 25 percent capacity.