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A Tattered Jersey

A Tattered Jersey

As communities along the Jersey coast put back together the pieces of their hurricane-damaged lives, hotels from Cape May to New York City assessed the devastation and worked quickly to re-open for business. John Daily, general manager of Congress Hall, a historic resort in Cape May, bounced back especially quick since he never followed Governor Christie’s edict and closed down to begin with. Despite mandatory evacuation orders, he kept the 106-room hotel open, filling 40 rooms with employees and 60 with media crews.

“We learned a lot from Hurricane Irene,” says Daily, who shuttered the hotel during the 2011 storm. “This time around, the forecasters were saying we could take a direct hit, or it could miss us to the north. We realized we were probably going to be in a safe zone.”

Luckily, Daily was right, and Sandy’s path of destruction left Cape May relatively untouched. He says the hotel became a hub for news outlets looking to cover the storm from the hotel’s balcony—primarily because Congress Hall was one of the few resorts that remained open.

“We boarded up all the windows, removed all furniture, and put anything small in our ballroom,” he says. “We never lost power. We were so fortunate, and count our blessings every day.”

Other cities along the coast were not so fortunate. The island town of Seaside Heights, made famous by the MTV reality show Jersey Shore, was ravaged by Sandy. Entire portions of the boardwalk, including the FunTown Amusement Pier, were shredded, and rides and attractions were dumped into the ocean. Weeks after the hurricane, residents and business owners could only return to the island as part of a strict re-entry program to assess the wreckage. Gas lines were severely damaged, with restoration expected to take up to nine months to complete.

In Atlantic City, not far from where Sandy made landfall, Howard Bacharach, executive director of the area’s hotel and lodging association, says properties in the gambling mecca reported minimal hardships. “I don’t believe any of the hotels suffered major damage from the winds or the flooding,” he says. “The sand dunes built by the federal government a few years ago mostly withstood the storm.”

Sam Patel, owner of Ramada Atlantic City-Pleasantville, says his property took on about a foot of water and approximately 30 rooms were lost due to water damage. Those rooms will all need to be renovated. He also says the lobby of the back-bay property sustained damage that will need to be addressed. After the storm, the hotel was running at 100 percent occupancy, and Patel says 60 percent of guests were families and individuals displaced by the storm.

Despite the damage to his property, Patel says the city will rebound, and hotels will get back on track. Still, he says the area could potentially see fewer visitors over the course of the year.

“So many people are displaced up and down the Jersey Shore and the city’s feeder markets. We don’t know how that is going to play out,” says Patel.

Keith Folly, senior vice president, Moody’s Investors Services, agrees that the casino properties in Atlantic City will continue to feel a financial hit as a result of the storm. “I think that there is going to be a long-term impact because a lot of the Northeast has been hurt in terms of people having access,” he says. “If people can’t get there, or if they are too busy dealing with their own troubles, they’re probably not going to go to the casinos anytime soon.”

Folly says gaming revenues in Atlantic City could take a 25 percent loss over the next two quarters. “This is not good news for Atlantic City given all the revenue loss due to increased competition. This storm couldn’t have come at a worse time.”

Of course, when it comes to devastation of this magnitude, there’s never a good time.

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