Fifth time appears to be a charm for the former Revel Casino in Atlantic City.
A federal judge has approved the sale of the building after four previous failed purchase bids.
Florida developer Glenn Straub’s $82 million offer represents four cents on the dollar of what it cost to build the glittering tower, whose owners first filed for bankruptcy in February 2013, a year after it opened.
Straub has also announced that he has the Showboat casino building under contract. Stockton University, Showboat’s owner, is ready to sell the building to Straub following a threat from Trump Entertainment Resorts to invoke a decades-old legal agreement to block the development of a college campus in the empty building.
Trump, which runs the Taj Mahal casino, said the legal agreement mandated that the property had to be used for a casino and said it fears underage kids would try to sneak into the Taj. Under the deal, the university has three months to cancel the sale to Straub, buying the university some time to smooth out the differences with Taj Mahal.
The deals are a piece of Straub’s grand vision for Atlantic City, which he’s calling the Phoenix Project. It includes an equestrian park, two marinas and a helicopter service to Manhattan.
But the sale leaves a few things unresolved. Namely, what about all the unpaid bills the energy company and others say they’re owed?
The judge put the $82 million Straub paid in an escrow fund and all the creditors will be fighting for a piece of it.
“Have you seen the seagulls at the beach when somebody’s eating pizza?” Asked attorney Stuart Brown representing ACR Energy, which provides power to the 57-story building. “It’s gonna be like that.”
Brown says ACR is owed more than $30 million, $22 million of which has accrued since Revel has been empty and in bankruptcy proceedings.
But now those battles will happen before another judge.
“Best case scenario is that ACR gets paid in full and we have a lucrative contract with Mr. Straub,” Brown said. “Worse case scenario is the opposite of all of that.”
Israel Posner, executive director of the Institute of Gaming, Hospitality and Tourism at Stockton University says getting that end of the Atlantic City boardwalk reactivated is extremely important as the tourism season is about to begin.
“The nature of the amenities that go in there are really secondary. I don’t think that anybody knows,” he said. “I’m not even sure that Straub knows because obviously the marketplace will dictate what works, what doesn’t work, and we’ll find out.”
WHYY’s Phil Gregory contributed to this report.