Atlantic City’s Revel Casino Hotel Receives $90 Million Bid
There has been a lot of news lately surrounding the awfulness that is Atlantic City and today, there’s more. In actuality, this news is somewhat decent. No, Atlantic City is not suddenly Willy Wonka’s chocolate factory, but at least something obscenely negative didn’t happen to a Boardwalk casino for once.
On Wednesday, the Wall Street Journal reported that real-estate developer Glenn Straub has put a bid in to buy the Revel Casino Hotel for $90 million. He was vague when asked about it by the WSJ, saying that his offer is “an opportunity to turn things around.”
“That’s what they need right now—a new direction,” he said. “Give us our six months, and we’ll actually physically be open. In two years, we’ll be 100% open.”
On the one hand, a “new direction” could involve a gambling-free makeover, but considering the city that it is in, the space already devoting to gaming, and the gaming assets the Revel must have, it would be odd to turn it into something completely gambling-unrelated. The six months / two years comment could potentially mean that parts of the property, maybe restaurants, shops, and other entertainment, could be put in play first, with gambling to follow later. This is just speculation on this writer’s part, though.
The Revel epitomizes terrible investment. Opened just two and a half years ago on April 2nd, 2012, the Revel cost $2.4 billion to build. It was designed by the architecture firm Arquitectonica, which also designed, among many other buildings, AmericanAirlines Arena in Miami, Philips Arena in Atlanta, the Westin Hotel in Times Square, Golden Moon Casino in Mississippi, the Cosmopolitan Resort & Casino in Las Vegas, and the City of Dreams Casino Resort in Macau. Its 57-story hotel tower is the tallest building in Atlantic City and the second tallest in the entire state; the Revel was clearly built to be a luxury competitor to the Borgata (Tishman Realty & Construction was the construction manager for both projects).
Of course, building a luxury casino in the midst of a slow economy and when Atlantic City has been losing visitors to casinos in neighboring states lends itself to the loss of money. Revel first came out of bankruptcy in May 2013 and filed again in June 2014 before finally shutting down this month.
After emerging from bankruptcy last year, the Revel tried to make changes to get back on track, but couldn’t stop the bleeding. Last July, it tried to attract players by offering to refund any losses over $100. Players wouldn’t just be able to walk to the cage and get the entire refund, though – the refund would be distributed over 20 weeks and players would have to visit the Revel to claim it. Casino management also tried to reinvent the Revel into “Revel 2.0” by focusing on the local and regional gambler. They even lifted a ban on smoking to try to win people back. Revel also closed its poker room in July 2013.
None of it worked, though. Now Revel might be known best as the casino where former Baltimore Ravens running back Ray Rice punched his wife unconscious. That and being a $2.4 billion casino that sold two years later for $90 million.
According to NJBiz.com, Straub’s company, Polo North Country Club, has deposited $10 million into an escrow account in advance of the potential purchase. The Revel still intends to field other offers. An auction for the property is scheduled for September 24th at 9:00am and the Revel has requested that the bid deadline be moved to September 23rd at 4:00pm.
The WSJ said that Alex Meruelo of the Meruelo Group also put in a bid for the Revel. Another offer has come from Carl Icahn, who holds the bulk of the debt owed by Trump Entertainment Resorts, which owns the Trump Plaza and Trump Taj Mahal casinos in Atlantic City. Trump Entertainment just filed for Chapter 11 bankruptcy, which could result in Icahn taking over the two casinos. The Trump Plaza is scheduled to close within days and lawyers for Trump Entertainment say that if concessions cannot be made with its main lender and labor union, the Taj Mahal may close in November.
Two other Atlantic City casinos have closed this year: the Atlantic Club and Revel’s next door neighbor, Showboat. Should the Trump Taj Mahal close, there will be just seven Atlantic City casinos left inhabited from the twelve at the year’s beginning. There were an estimated 32,000 employees of those dozen casinos; there will be an estimated 8,000 fewer by the end of the year.