Three years to the day after Atlantic City's $2.4 billion Revel casino opened — and seven months to the day after it closed — a bankruptcy court judge approved its sale to a South Florida developer for about 4 cents on the dollar.
Judge Gloria Burns approved the $82 million deal, which did not address the rights of former business tenants at the casino to operate there when it reopens. The approval Thursday came after Glenn Straub's Polo North Country Club agreed to drop its demand that the sale go through "free and clear of encumbrances" like the tenants' leases — an issue that had helped scuttle several prior attempts to sell the casino. Burns said the issue of whether tenants can remain there should be worked out with Straub outside of bankruptcy court.
"We have to get started," Straub said. "This is less than a month and a half from now."
Referring to an estimated investment in reconfiguring the building, Straub said, "I can't afford to sit on $150 million."
Straub said after the hearing he has reached a deal to buy several casinos or former casinos in Atlantic City as part of a $500 million, multi-faceted deal. He said details would be revealed on Saturday, but added, "I've already bought them."
Attorneys for Revel and Straub said they planned to close the Revel sale on Friday, but Burns said they'd have to wait until Monday after late arguments prevented her from signing and entering an official order.
Burns' approval was the second she made this year for Straub. An earlier $95.4 million sale she approved in January fell apart after an appeals court blocked part of it.
Thursday's approval came on the fifth attempt to sell Revel, and it occurred despite last-minute entreaties from would-be bidders for more time to put together a better deal than Straub's. They included a group led by Howard Milstein of New York and Carl Goldberg of New Jersey that offered $88 million but acknowledged it was unable to reach a deal for energy services with the power plant that is Revel's sole source of heat, air conditioning, water and electricity. The judge and attorneys for Straub, Revel and lender Wells Fargo had little patience for such requests.
"We've spent six months where we could have been building Atlantic City," said Straub's attorney, Stuart Moskovitz. "We've been waiting for Godot instead of building Atlantic City, and Godot isn't showing up, with all due respect to any attorneys representing Godot."
Wells Fargo has spent more than $64 million on Revel's bankruptcy case and says it is done writing checks. Attorney Thomas Kreller told the judge the case has been beset by "empty, false promises to persuade your honor there's light at the end of the tunnel. Your honor: There isn't a tunnel. It's a hole. It gets deeper, and there is no light."
Straub has proposed a vast array of uses for the property, including a scaled-down casino, hotel, condos, a water park and a "genius academy" where the world's top minds would tackle society's biggest problems.
Revel opened on April 2, 2012, and was seen by many in Atlantic City as a game-changer, a catalyst to reverse years of declining casino revenue and decreasing jobs. But its focus on high-income luxury guests and leisure travelers never caught on sufficiently, and mom-and-pop gamblers felt unwelcome there.
It filed for bankruptcy twice and shut down on Sept. 2, never turning a profit.