Revel Casino Hotel will remain just that — a casino hotel — a spokesman for Brookfield Asset Management said Wednesday after one of the company’s offshoots was declared the winner of a bankrupty auction.
But a quirky south Florida real estate developer whose firm was named runner-up vowed to fight for the Boardwalk property in court.
The shimmering glass estate is “a hugely important asset for Atlantic City,” said Brookfield Asset Management spokesman Andrew Willis.
Brookfield US Holdings LLC, whose $110 million offer was declared the winning bid of a bitterly contested bankruptcy auction, is part of Brookfield Asset Management, which owns the Atlantis resort in the Bahamas and Hard Rock Las Vegas, he said. Both properties feature casinos.
The offer also includes “certain assumed liabilities and additional considerations,” according to a Wednesday court filing.
A formal sale still requires approval from a federal judge at a hearing slated for Oct. 7. Willis declined to comment on when the property would reopen.
“They’re obviously a company that’s familiar with gaming,” said Atlantic City Mayor Don Guardian, who hopes the casino hotel, which opened in 2012 and cost $2.4 billion to build, will be back in business before Memorial Day.
After months of crisis — Atlantic City has lost four of its 12 casinos and more than 7,500 jobs so far this year — “the start of the recovery” may be under way, he said.
“There were a lot of doomsayers who said no one was going to bid on Revel.” At $110 million, the declared winning bid is “a good chunk of money” but still a bargain-basement price, he said.
Brookfield US Holdings LLC won the auction with an offer made early Wednesday morning, Revel spokeswoman Lisa Johnson announced.
A $95.4 million offer by Polo North Country Club Inc., run by South Florida real estate developer Glenn Straub, was selected as a backup bid, she said.
But Straub said Wednesday that Revel’s attorneys botched the auction and broke the rules. Straub said he will ask Chief U.S. Bankruptcy Judge Gloria Burns next week to declare him the new owner.
“It should be awarded to us,” he said. If necessary, “We’ll go to the appellate court,” Straub said.
Straub, who made the starting, stalking horse bid and is expected to receive a $3 million payout if the property is not sold to his company, complained throughout the auction process about what he said was an utter lack of transparency. He said his initial $90 million cash bid was the sole offer accepted by Revel before a court-ordered Sept. 23 deadline.
The hard-charging polo enthusiast has said he would run a casino at Revel but that gambling would not be the dominant draw.
He recently told The Press of Atlantic City that he wants to build a second tower at the property and colonize it with “geniuses” working on pressing global problems, such as nuclear waste disposal. His plan for Atlantic City also includes “high-speed catamarans” to ferry people to and from Manhattan, “super jumbo jets” for Arabian tourists, and a ski resort of elevator-equipped artificial mountains, he said.
Straub and Brookfield sparred Tuesday night, with Brookfield upping its offer to $110 million, said Straub’s attorney Stuart Moskovitz.
Brookfield said the offer was only good until 6 a.m. Wednesday, and Straub’s team couldn’t immediately get in touch with his accountant to mount a counter-offer, Moskovitz said.
Moskovitz called Brookfield’s offer an “extortionate bid” and pledged to challenge it in court. “There’s no question that’s where this will all end up,” he said shortly after midnight.
But Jonathan Lipson, a professor at Temple University’s Beasley School of Law who studies the bankruptcy process, said Straub won’t necessarily be able to tie the Revel property up in litigation.
If Judge Burns finds that Brookfield’s offer is, in fact, materially better than Straub’s and that the auction was conducted in good faith, “the judge will feel great pressure to approve it,” he said. “She’s not going to want to hold this up any longer than necessary.”
And if she rules against Straub, “the bankruptcy code makes it difficult for a disgruntled challenger to appeal,” he said.
Burns might ask Straub to make a counter-offer at the upcoming hearing, Lipson said.
Bob McDevitt, president of UNITE-HERE Local 54, said in a statement Wednesday, “We haven’t seen the bids, but we assume that they are planning to hire back all of the people who worked at Revel previously.”
About 2,800 Revel workers lost their jobs when the property closed in early September.
“We’re hopeful that this is a positive step forward, not just for Revel, but for all of Atlantic City,” said McDevitt, who is fighting a push by another bankrupt casino-hotel, Trump Taj Mahal, to force concessions from union workers. Attorneys for Trump Taj Mahal say that property will close in November without changes to a labor contract.
Michael Barry, who runs the company that owns the critically acclaimed HQ Nightclub inside Revel, said Wednesday’s announcement was music to his ears. Brookfield, he said, is “obviously a very substantial player in the marketplace.”
“We’re interested to get HQ open essentially immediately,” he said. “My attorneys have already reached out to Brookfield’s attorney.”
“I’m very excited to hear that the purchaser is a casino-hotel owner,” he said. “It’s great news.”
Staff writer Derek Harper contributed to this report.
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