A bankruptcy judge has sided with Atlantic City’s closed Revel casino ruling that a deal to sell the property for .4 million can be cancelled.
Revel was to be sold to Florida developer Glenn Straub and his Polo North Country Club, but Straub was unable to close the deal by a February 9 deadline. That led to Revel asking for a cancellation of the deal and the right to keep Straub’s $10 million deposit.
Straub, however, argued that ongoing legal problems and appeals from with Revel’s tenants, as well as problems with the casino’s main energy provider, stopped him from closing by the deadline and asked for an extension.
Bankruptcy Judge Gloria Burns denied the extension and allowed the sale to be scrapped.
Saying the “history of this case is long and tortured,” Burns ruled that the terms of the contract did not allow Straub to wait until the former Revel tenants’ legal appeals were resolved before closing on the sale.
Tenants of the closed property—which operated successful nightclubs and restaurants—invested $16 million into the property and are seeking protection in appeals court. Burns originally ruled that Straub could buy the property free of those leases, but the appeals court has said no deal can go forward without the tenant’s leases being considered.
Burns said it was obvious the appeals process will take months to be resolved.
Revel attorney John Cunningham told the judge the casino will continue to seek to keep Straub’s $10 million deposit.
“We are going to seek to be allowed to spend that money,” he told the judge.
Stuart Moskovitz, Straub’s attorney, said Straub will likely keep fighting.
“No game ends in the first quarter,” Moskovitz told the Associated Press. “Obviously we will be appealing. There’s a lot still going on, including settlement talks with Revel.”
The ruling does not necessarily mean the end of the deal with Straub, even as Revel attorneys have said they are seeking other offers for the casino tower. Moskovitz has said Straub is still trying to negotiate a sale.
“We’re prepared to entertain offers from anybody who’s interested in it,” Revel attorney Michael Viscount told the Press of Atlantic City.
As for Straub, “If he came forward today ready to close I suspect that we would take his money,” Viscount said.
Revel officials also told the court that there are no current acceptable offers for the Boardwalk complex, and said liquidation of the property is possible.
This is the second time a deal to sell the troubled casino has fallen through. Toronto-based Brookfield Asset Management walked away from a planned $110 million purchase after it too was unable to reach a deal over payment of debt for the casino’s power plant.
ACR Energy, the plant’s owner, is seeking to recover building costs and energy payments from the court as well as any potential buyer.
