Developer Bart Blatstein, now owner of the former Showboat casino in Atlantic City, says he has settled a conflicting deed restriction problem, which derailed previous efforts to re-open the site.
The settlement is with billionaire Carl Icahn, who owns the neighboring, soon-to-be-closed Trump Taj Mahal casino. The settlement allows Blatstein to continue operating the Showboat – which has re-opened as a hotel – without a casino.
Blatstein told the Associated Press that Icahn agreed to only “a minor consideration” that does not involve payment in return for resolving the claim.
Showboat has been a difficult property to re-open after it was discovered that a deed restriction on the property that said it could not re-open as a casino conflicted with a 1988 legal covenant requiring that the Showboat not be used for anything other than a casino.
Nearby Stockton University originally bought the site with hopes of opening it as an Atlantic City campus, but Taj Mahal management objected and cited the 1988 agreement. Taj officials said they did not want a college campus housing underage students adjacent to their casino. The university was forced to abandon the property, selling it to Blatstein for $23 million.
Blatstein has since re-opened part of the property as a non-casino hotel, but the issue of the competing restrictions still hung over the property, even though the Trump Taj Mahal is now scheduled to close down this month.
Blatstein, however, said the issue is now settled.
“I have a nice working relationship with Carl, and he is interested in doing the right thing for Atlantic City,” Blatstein told the AP. “No money changed hands, and it was a pleasure dealing with him.”
A spokesman for Icahn confirmed the agreement but declined to comment further, the AP reported.
The original covenant was intended to ensure that a block of casinos on the Boardwalk’s north end would remain casino properties. The covenant was between Showboat, the Taj Mahal and Resorts casino.
Blatstein told the AP that no additional permission from Resorts is required to drop the covenant, saying the Taj Mahal was able to exercise authority on behalf of Resorts. Resorts did not respond to a request for comment from the wire service.
The restriction on re-opening the property as a casino was placed on the property by former owner Caesars Entertainment when it shut the casino down in August 2014. However, Blatstein said the restriction runs for only 10 years, opening the possibility that he could re-open a casino at the site in the future.
Blatstein said he is still not sure exactly what the former property will eventually be developed into, but said he is excited and that the property “has real value now.”
“By opening it we now have a better idea of what the property can do,” Blatstein told the Press of Atlantic City. “We will be able to take what we learn and apply it for the future. It’s an amazing property. Right now, I’m spending 90 percent of my business time in Atlantic City. I’ve fallen in love with the city.”
Blatstein said that along with the hotel re-opening—which includes two restaurants, a gym and a coffee shop—he hopes to build a multimillion-dollar “multi-use event center” that will be part of Showboat on an adjacent 3-acre site he also owns that once was a public-access volleyball court.
