On Thursday, U.S. Bankruptcy Judge Gloria Burns gave final approval on the sale of the Revel casino in Atlantic City to Florida developer Glenn Straub for $82 million. The approval comes three years to the day of Revel’s opening and seven months after its closing.
Thursday’s decision sets the stage for the conclusion of one of the most unusual casino sales in recent memory. This if officially the fourth time that the property has been deemed sold. A final order will be issued by the judge on Monday, at which point Straub is expected to close immediately.
Money Talks and Everyone Else is Forced to Walk
Ultimately, the decision by Judge Burns was an easy one as the property has failed to receive new bids. A group led by real estate moguls Howard Milstein and Carl Goldberg reportedly wanted to bid $88 million for the property but failed to do so when they couldn’t make a deal with ACR Energy Partners. Californiainvestor Richard Meruelo has expressed interest as well but also failed to put up any cash.
Judge Burns had considered delaying the sale a few weeks but Revel’s primary lender, Wells Fargo, testified that they would not continue to bankroll the bankruptcy for much longer. Burns declared, “there’s no funding left” and decided against a recess.
As part of the sale, Straub has agreed to drop his demand that the title be awarded “free and clear.” Burns says that tenants should work out their deals with Straub outside of bankruptcy court. Some tenants have up to $16 million invested in the property while others have leases that don’t expire for over a decade.
Revel Part of a $500 Million Deal
Revel just appears to be the first piece of the puzzle for Straub’s involvement in Atlantic City. After Thursday’s hearing, Straub revealed that he has a deal in place to purchase several casino properties in the area. He’s spending approximately $500 million on the properties and claims that a formal announcement will happen on Saturday.
“I’ve already bought them” was the claim from Straub on Thursday. One of those properties is rumored to be the Stockton College owned Showboat. Stocktonhas been unable to move forward with their plans to create an Atlantic City campus due to deed restrictions on the property. Showboat was mentioned by Straub and attorneys during Thursday’s hearing, claiming that they would close on the property on Friday.
Another potential property that could be in play for Straub is the former Trump Plaza. The casino has been shuttered since the summer with no apparent interest having been shown in purchasing the property. With the company nearly ready to emerge from bankruptcy, a sale of the former Plaza could bring a much-needed cash infusion to the property.
Other names dropped during the hearing by Straub included MGM, Borgata, Boyd Gaming, the new marina and “the airport we’re reactivating.” Of course, Straub has been all over the board with his plans for Revel so it will be interesting to see the final details of this rumored deal. What we do know for now is that should Straub close on the Revel on Monday, he will spend approximately $150 million to renovate and reopen the property.
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[Image Credit at top: billpenn.com]