Revel Casino Received a $90 Million Purchase Offer in New Jersey Bankruptcy Court
Glenn Straub, a Florida real estate developer who plans to buy the Revel Casino and Hotel for $90 million, told USA Today he laments the idea that, “When everybody thinks of Atlantic City, they think of casinos.”
Straub has yet to announce what he plans to do with the Revel Casino. The options are limitless, because the Revel complex is a brand new, state-of-the-art building. Revel opened for business in 2012, so it is a modern structure. One engineer has said that Revel Casino is more than just a new skyscraper; he described the innovative design as most interesting building on the east coast.
Revel Will Not Be Used for Gambling
The developer did tell the newspaper that people should not expect to see a mega-casino on the site, though. Straub says he would be bothered by the idea of his family profiting from a gambling enterprise.
Straub did get a nice bargain in purchasing the Revel Casino complex for $90 million. Revel cost $2.4 billion to build. He bought the property for less than 4% of its value in 2012.
$90 Million Purchase in Bankruptcy Court
The purchase came in federal bankruptcy court on Wednesday, after the owners of the Revel agreed to a cash sale. The purchase is still subject to court approval, but it is expected to be approved.
How a Billion-Dollar Casino Fails
The Revel Casino closed its doors on September 2 after 28 months in business. During that time, the casino had gone through 2 bankruptcies. Even before it opened, one of the original investors (Morgan Stanley) pulled out of the development with a $900 million loss.
In many ways, Revel Casino was a victim of bad timing. The casino was approved by the Division of Gaming Enforcement before the Global Recession hit, and it being developed in the years following the market collapse. The developers can be lauded for bravery or castigated for their folly, but they were trying to bring a Las Vegas-style integrated resort to Atlantic City. What they didn’t know was the free fall the Atlantic City gaming industry was in, due to market forces beyond the collapse of the real estate market. By the time that was evident, it was too late to stop the process.
Polo North Plans May Involve Rail Links
Though Glenn Straub hasn’t revealed his company’s plans for the property, he hints that he plans big things with his investment and it should benefit Atlantic City. Straub, who is the president of Polo North Country Club near West Palm Beach, Florida, said that the timing was right for the purchase.
When asked about his company’s interest in Revel Casino, Straub told the USA Today, “It’s just a coincidence that that building was something we were working on. We feel the city needs what we do–we are like doctors who turn around sick patients. We turn around big properties.”
About Polo North Country Club
Straub says the Polo North Country Club has 600 development projects, and that “improving things” is what those projects tend to do. He hinted that the Revel Casino project is part of a “major undertaking” involving New York City and Philadelphia. Early speculation is the Polo North project involves high-speed rail links between the cities.
If so, then it is a glimmer of hope for Atlantic City. Such a railway would make travel to Atlantic City cheaper and less time consuming for visitors from New York City, Philadelphia, and beyond. Under those circumstances, trips to Atlantic City for gambling or non-gaming vacations might increase. Such a project would fit under the definition of “improving things“.
Straub Warns Sports Betting Won’t Work
When asked about Governor Chris Christie’s plan to allow sports betting at Atlantic City casinos (along with racetracks throughout the state), Glenn Straub told the paper that people in the city should not look at gambling to solve their problems. Straub said, “Sports betting–it’s like giving aspirin to take care of a cancer patient.”
The developer says people should not assume the sale will happen. His company still has several hurdles to clear, such a labor negotiations, which sometimes stand in the way of development in the northeast. If everything goes well, though, the Polo North Country Club purchase of Revel Casino could be one of the turning points for the city.
