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Atlantic City Hilton Defaults on Mortgage

ATANTIC CITY-In a recent filing with the New Jersey Casino Control Commission, the owners of the Atlantic City Hilton said it has defaulted on its mortgage.

By Maria Wood | Updated on August 24, 2009

ATLANTIC CITY-Like a gambler’s losing streak, the losses keep piling up for this gaming Mecca. In a recent filing with the New Jersey Casino Control Commission, the ownership entity of the Atlantic City Hilton said it has defaulted on its mortgage.

The hotel/casino features 800 rooms and a 75,374-square-foot main casino floor. It is owned by RIH Acquisitions NJ LLC, a subsidiary of Resort International Holdings LLC, which itself is an affiliate of Colony Capital LLC. In the filing, RIH stated that on July 9, due to “the severe impact of the current economic conditions,” it failed to make its monthly interest payment and monthly funding requirements under its loan agreement, thereby triggering a default.

As of June 30, the outstanding debt balance amounted to $348.2 million, plus related accrued interest of $868,000. The company further stated it was in negotiations to modify the terms of the loan agreement. According to the filing, RIH refinanced its outstanding debt in 2006 by entering in a commercial mortgage-backed security with JP Morgan Chase.

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