Philadelphia developer Bart Blatstein, who is competing for a casino license to build a gaming resort in Center City around the old Philadelphia Inquirer & Daily News building, is buying the Pier Shops at Caesars in Atlantic City.
Blatstein confirmed Sunday he has an agreement to buy the four-level shopping center but would not disclose the price being paid by his Tower Investments, which specializes in redeveloping distressed properties into residential, entertainment and retail spaces.
The Philadelphia Business Journal quoted it at $2.5 million, which would be less than the cost of some beachfront homes.
The Pier cost $200 million to develop and has been on the market since an investment group that includes U.S. National Bank Association took over in an October 2011 foreclosure sale.
No one from The Pier could be reached for comment Sunday.
Blatstein said Sunday he has plans to transform The Pier into a destination in itself by adding another dimension to the mix of upscale and mid-priced shopping and dining there now. He said he would hold a press conference to announce his plans in November, around the time he expects to close on the property, but that those plans would not include gambling.
“Atlantic City has everything. People love the beach, Boardwalk and ocean,” said Blatstein, 60, who said he has a home in Margate and has been visiting Atlantic City since childhood. “People just need a reason to go.”
He said his plans for The Pier will be game-changing for the city and that the environment is right for investment in the resort now that local and state officials and residents agree that something new needs to be done in the city.
His partner in the Pier deal is Atlantic City native Paul Steelman, a casino architect who designed Blatstein’s Center City casino project, known as The Provence, Blatstein said.
“We’re not impulsive,” Blatstein said of Tower Investments. “I rarely leave Philadelphia for development.” He added he believes in the future of Atlantic City “1,000 percent.”
If his Philadelphia casino project moves forward, he does not envision cross-marketing with The Pier.
“They are distinct and separate,” he said.
The Pier was built at 1 Atlantic Ocean in 2004 and redeveloped in 2006. Attached via skybridge to Caesars Atlantic City with direct access to the Boardwalk, the mall has struggled since opening in 2006.
In March 2013, Pier Shops General Manager Harry Geety, who has since left the job, said negotiations to buy The Pier failed with New York real estate investor Michael Kohan. Kohan owns malls nationwide and specializes in buying distressed shopping centers out of bankruptcy or foreclosure. Geety said then that Kohan made an offer but did not disclose the amount.
In August 2012, an online auction with a minimum bid of $20 million failed to sell the property.
The Pier’s shops include some of the glitziest names in retail, such as Gucci, Louis Vuitton and Tiffany & Co. The mall also includes upscale restaurants.
At the time he made his offer, Kohan said The Pier has a $3 million annual loss on $12 million in operating costs. The electricity bill alone is $1.1 million per year, he said.
Tower Investments has completed a long list of Philadelphia redevelopment projects, including The Shops at Avenue North in North Philadelphia and The Edge at Avenue North, a 12-story residential facility housing about 1,200 Temple University students; the luxury Tower Place on North Broad Street; and the nationally known Northern Liberties Redevelopment, which its website said “began in January 2000 when Tower acquired the former Schmidt’s Brewery at 2nd and Girard in Northern Liberties at Sheriff sale.”
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