For two years, Pinnacle Entertainment Inc. has been unable to sell a prime piece of casino-zoned land located in the heart of the Boardwalk.
There were no buyers the first time Pinnacle tried unloading the 20-acre oceanfront property, so now it’s going through another attempted sale. But the process has been shrouded in secrecy.
Jones Lang LaSalle, a real estate firm overseeing the sale for Pinnacle, had set a June 29 deadline for offers. However, representatives of both companies declined to say whether any bids were made then.
“Really no comment other than that the land is for sale and the process is ongoing,” Pinnacle spokeswoman Kerry Andersen wrote in a brief email.
Scott Cullen, an executive with Jones Lang LaSalle, also would not comment.
Joshua Levin, owner of Levin Commercial Real Estate in Atlantic City, said Jones Lang LaSalle refused to tell him anything about the property, including the sale price, when he tried making inquiries.
“It’s basically a closed auction,” Levin said. “Instead of putting everything out there for everyone to know, they only want to attract qualified buyers. When you have a highly visible property like that, you want to do this.”
Earlier in the year, Pinnacle representatives had talked vaguely about “undergoing a new process” for marketing the land. Carlos Ruisanchez, Pinnacle’s chief financial officer, told analysts during a conference call in May that the company was watching the Atlantic City market and was more hopeful for a sale.
Pinnacle, a Las Vegas-based casino operator, has been stuck with the gigantic empty lot ever since it aborted plans to build a $1.5 billion megaresort. In 2010, when the sale began, a Jones Lang LaSalle official made the extraordinary public statement that Pinnacle would probably have to accept just 30 percent of the $270 million it paid for the site in 2006. Real estate experts believe the land will sell at a far steeper discount than the Jones Lang LaSalle estimate.
In 2006, there was still a casino standing on the property. Pinnacle bought the Sands Casino Hotel from billionaire investor Carl Icahn for $270 million and spent millions more acquiring other surrounding private property. Pinnacle imploded the Sands in 2007 to make room for what was supposed to be its new Las Vegas-style casino resort. However, the recession and global credit crisis killed the Pinnacle project.
Wanting to pull out of Atlantic City, Pinnacle then made the decision to sell the property. Most of the land consists of the old Sands site, a supersized block bordered by Indiana Avenue, Pacific Avenue, Dr. Martin Luther King Jr. Boulevard and the Boardwalk. There are other, smaller parcels, mainly concentrated on the beach block of Kentucky Avenue.
Atlantic City officials have acknowledged the image problems created by having such a high-profile piece of land remain empty. Hoping to dress up the site, the Atlantic City Alliance has hired New York-based art curator Lance Fung to transform the Pinnacle lot into a colossal work of public art later this year. Fung, known for his major exhibitions, including “Snow Show” at the 2006 Winter Olympics in Torino, Italy, will also turn other barren sites in Atlantic City into public works of art.
Jeff Guaracino, a spokesman for the Atlantic City Alliance, a marketing coalition funded by the casinos, stressed that Fung’s art work will only be temporary. He said the ultimate goal is to see the Pinnacle property redeveloped.
“It is a direct, collective decision of the owners and many others that the lot should not remain empty. Our project is not designed to stop development,” Guaracino said.
Marketing materials prepared by Jones Lang LaSalle tout the Pinnacle site as a “one-of-a-kind asset” offering a number of potential development opportunities, including a casino, a hotel, retail development or an entertainment project.
Levin suggested turning the site into a temporary entertainment attraction, perhaps an amusement park, that could generate income until long-range redevelopment plans could be undertaken. Over the long haul, he believes the site could become a “mini-destination” of shopping, entertainment and parking.
One other possibility, Levin said, is to convert the site into a smaller-style boutique casino hotel. Although Pinnacle originally wanted to build a massive casino, it later played with the idea of developing a boutique casino, before backing away from that project last year.
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