Stockton University last week announced it has an official buyer for the closed Showboat casino. The following day, Bart Blatstein, a Philadelphia developer who opened the Playground on the former Ocean One and Pier at Caesars last summer, was identified as the purchaser. The sale could finally get the school out of the expensive boondoggle of buying the closed casino under a former president.
The announcement came at a meeting of the school’s Board of Trustees, according to a report in the Press of Atlantic City. The board then approved a resolution to sell the property.
According to the Press, the resolution says Stockton President Harvey Kesselman has negotiated and fully vetted an agreement of sale for the Showboat Hotel and Casino property, and was working with the buyer to complete its due diligence investigation and to complete the sale pursuant to the agreement of sale.
The sale to Blatstein makes sense, according to Kessleman.
“We were seeking a purchaser who demonstrated a commitment to Atlantic City when others were unwilling,” he said. “Bart Blatstein is such an individual. The agreement allows the university and Mr. Blatstein to continue working together in ways that will benefit Stockton and contribute to Atlantic City’s renaissance.”
Blatstein did not comment following the announcement. He paid $22 million, an increase over the $18 million that Stockton paid for the property, which comes close to the price and the money that Stockton used to maintain it over the past year. The school has been spending about $400,000 a month to maintain the property.
Stockton initially bought the property—which was closed last year by Caesars Entertainment despite still being profitable—in hopes of making it the site of an Atlantic City campus for the school. But the sale quickly bogged down after it was disclosed that two contradictory use covenants had been put on the property.
Caesars sold the property to the school with a deed restriction that it could not be used as a casino. But Caesars had entered into a covenant with nearby casinos in the 1980s saying that the site could only be used as a casino. The neighboring Taj Mahal casino then invoked that covenant.
Unable to settle the contradictory restrictions, the school tried to sell the property to developer Glen Straub, who owns the nearby Revel casino site for $24 million, but that sale fell through due to the restrictions. Straub is still challenging the matter in court. A judge in that case, however, ruled that Stockton could seek a new buyer for the property.
It’s unclear what, if anything has changed with the restrictions concerning a new buyer. Blatstein has not outlined his plans for the Showboat and whether or not he plans to reopen the casino. The sale was made with no ties to the liquor licenses or the gaming permits needed to reopen a casino. Caesars stripped the property of all gaming equipment before selling it to Stockton.
Blatstein was a bidder, however, for the second gaming license in Philadelphia, which eventually went to a partnership of the Cordish Companies and the group that owns Parx casino in Bensalem, Pennsylvania. His innovative Provence would have incorporated the former home of the Philadelphia Inquirer in center city.
The board also released the results of an investigation into the sale that cited former University President Herman Saatkamp and lawyer Stevan Sandberg for mishandling the initial “unwise” sale and rushing to close the sale despite the issue of the covenant with the Taj Mahal and without a thorough representation of the sale’s details to the board.
The report also said Caesars Entertainment may have misled college officials about the status of the contradictory restrictions, the Press reported, but Caesars, in a statement, denied the charge.
