Cheap Revel Sale Not Good Enough

Nothing has come easily for Atlantic City’s Revel casino, from the death of three executives in a plane crash to running out of money, going bankrupt twice and finally closing after just over two years of operation.

Photo: AP Photo

But the difficulties for the $2.4 billion Revel reached a new level Monday when a Florida developer won the right to buy it for $95.4 million — and immediately announced he was going to court to halt the sale to himself.

Glenn Straub’s Polo North Country Club is the only bidder left for Revel. But it now wants the former casino at a lower price than it last offered.

“This is a most unusual sale motion in that we have an objection by Polo North to their own sale,” Revel attorney John Cunningham said. “I think in my 23 years of practicing bankruptcy law this is my first time to see that.”

In the fall, Straub bid $95.4 million for the casino resort. He wanted bankruptcy Judge Gloria Burns to approve an $87 million sale price, which she refused to do.

The judge ruled that Straub’s most recent bid is still binding, and that is the price he will have to pay. That led Straub’s attorney, Stuart Moskovitz, to say he will seek a court order halting the sale to his client. He asked Burns to issue a stay to her own order, but she refused.

View galleryThis photo taken Oct. 17, 2012, shows the Revel casino …
This photo taken Oct. 17, 2012, shows the Revel casino in Atlantic City NJ. A federal judge will con …
During a break in the hearing, Moskovitz said Straub “is not making any decisions right now.”

Straub refused to say whether he intends to operate the property as a casino hotel or for some other purpose. One of many ideas he has floated involves gathering the world’s top minds at the site to work at a “genius academy” to tackle society’s problems.

But Straub also sounded like it would not trouble him too deeply if the deal fell through. He said he remains interested in “wineries and country clubs” in the region.

During an hourlong break, Revel attorneys spoke with Straub and his lawyer about unspecified language to be included in a final sale order. But Cunningham told the judge that Straub and his lawyer “will not engage. They feel they need more consultations with experts. He continues to tell us he’s going to appeal your order.”

Moskovitz told the judge that Straub simply needs a few days to consult with others, including nongambling businesses that operated at Revel. After the hearing, Moskovitz said no court challenge would be brought before Thursday.

Burns reiterated her belief that the auction was done properly, and that there are no grounds to void its results — something Straub had sought as an alternative if his request for a lower purchase price was rebuffed.

In October, the court approved a sale to Toronto-based Brookfield Asset Management for $110 million. Brookfield pulled out of the deal a month later in a dispute with bondholders over debt from the construction of Revel’s costly power plant.

That led the court to turn to Straub’s Polo North Country Club as the runner-up bidder, whose last bid was $95.4 million.

Moskovitz said Straub’s bid of $90 million should be in effect “because we believe the entire bidding process was tainted.” He also wanted a $3 million “breakup fee” applied to the purchase price, which the judge denied. He objected and asked the court to set aside the auction results last year after it emerged that Revel attorneys had represented companies affiliated with Brookfield in unrelated matters.

Revel shut down on Sept. 2 after little more than two years of operation in which it never turned a profit. It was one of four Atlantic City casinos to close in 2014.

Its entire history is rife with setbacks and tragedies. It broke ground just before the Great Recession hit, and it ran out of money halfway through construction. Three of its top executives were killed in a plane crash, and a construction worker was fatally struck by lightning.