A federal judge on Monday said she will approve a proposed $95.4 million sale of the closed Revel Casino Hotel to real estate developer Glenn Straub’s company, Polo North Country Club Inc.
But Straub wants the property at a steeper discount, and on Monday his attorney said he would turn to U.S. District Court to halt the decision, potentially suspending a sale process already marred by delay.
Polo North wants its initial offer for the Boardwalk complex — $90 million — to stand.
Polo North attorney Stuart Moskovitz said Monday that the company never would have upped its original offer if it knew a September auction for the defunct resort would be opaquely run and tainted by conflict of interest.
“Our $90 million bid should have stayed the way it was,” he told Chief U.S. Bankruptcy Judge Gloria Burns. “We’re asking to be put in that position — the position we would be in if there weren’t improprieties.”
Revel attorney John Cunningham fought the request, calling it “a showstopper.”
“I definitely have to admit that this is a most unusual sale motion in that we have an objection by Polo North to their own sale,” he told the judge. “I think in my 23 years of practicing bankruptcy law this is my first time to see that.”
Burns said she plans to sign an order by Thursday approving the proposed sale. It was the second time the judge gave her blessing to a sale of the property, which cost $2.4 billion to build and which closed in September after less than three years in operation. “There was a fair auction,” she said. “The sales process was fair.”
Earlier she denied Polo North’s request for a $3 million “breakup fee” that would have awarded the company for acting as the auction’s stalking horse. The company wanted that fee applied to the $90 million, lowering the price tag to $87 million.
A deal to sell the property for $110 million to Brookfield US Holdings, which was declared the winner of the auction, collapsed last month. Brookfield said it aborted the sale because of a burdensome financing arrangement connected to Revel’s power plant.
Straub’s plans for the failed resort remain unclear, and he declined to detail them during a break in Monday’s hearing. In the past, he’s said there will be a casino at the property but that gambling won’t be the dominant draw. He’s also discussed building a second tower at Revel and creating a university colonized by geniuses working on pressing global problems, such as nuclear waste disposal.
On Monday, the businessman said he’s in advanced stages in acquiring other South Jersey properties, mentioning Renault Winery Resort and Golf, which filed for Chapter 11 bankruptcy protection in November. “We’re already pregnant,” he said.
This was news to an official at Renault.
“Other than an initial meeting with Mr. Straub we have not had any further contact with him about purchasing the resort,” said Dennis Del Vecchio, chief operating officer of Renault Winery.
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