Plans to transform one of Atlantic City’s few remaining historic hotels into luxury condominiums collapsed Monday when the would-be buyer withdrew from the sale.
Maurice Davis, a Philadelphia construction contractor, said he had offered to buy the Madison House for $5.7 million, but backed out of the deal after discovering the hotel had an existing mortgage.
Davis said he had been under the impression in previous talks with the owner, the Madison House Group, that he would be able to buy the hotel “free and clear” without an existing mortgage.
“There were monies on the property exceeding the sale price. This was previously not disclosed,” Davis said.
The sale was supposed to close Monday, but Davis said he could not reach a final agreement with the Madison House Group’s George Levin, a principal owner. Levin could not be reached for comment.
Davis, however, expressed hope that the sale could be resurrected if an agreement is reached to remove the mortgage.
“I would love to revive it and purchase the property,” he said.
Davis wanted to convert the Madison’s 126 suites into 54 deluxe condos. He planned to keep the 14-story hotel’s top floor for his own living quarters. Part of the building would have offered condos for nightly rental, like a hotel.
Davis also had planned to decorate the hotel’s bar, lobby and other public spaces on the first floor with a 1930s theme, harkening to the Madison House’s original designs. The Madison was an upscale hotel when it opened in 1930, just months after the 1929 stock market crash plunged the nation into the Great Depression.
There have been fears about the Madison House’s future ever since the hotel closed in 2006. The old Sands Casino Hotel used the Madison as a companion hotel for gamblers, but when the Sands shut down in 2006, so did the Madison. The Sands spent $7 million in 2004 to transform the Madison into a boutique property, downsizing the hotel from 250 rooms to 126 mini-suites.
The Madison is listed on the National Register of Historic Places, giving it protected status, but hardly an ironclad guarantee that it will not eventually be demolished. It is a throwback to the days of posh Boardwalk hotels, but most of those historic landmarks were demolished in the 1970s and ’80s to make way for a new wave of casinos.
Located about a block from the ocean, the Madison overlooks the southern tip of Dr. Martin Luther King Jr. Boulevard, just off the busy Pacific Avenue casino strip. Clad in red-brick construction, it is designed in the Colonial Revival style. Inside, it has marble floors, chandeliers and a grand staircase modeled after the one in Philadelphia’s Independence Hall.
“I love the structure of the Madison,” Davis said. “The location, I believe, is an up-and-coming area. It is a building of character and it has been around for a while.”
Davis is the owner of the Philadelphia-based Contractors MD Inc., which specializes in high-end kitchen and bathroom renovation projects. He said he continues to look for an Atlantic City investment, even though the Madison House sale fell through.
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