PHILADELPHIA – The sale of Atlantic City’s former Revel casino is on hold while the company that ran its popular nightclub and beach bar appeals.
Third U.S. Circuit Court of Appeals Judge Thomas Ambro, based in Philadelphia, ruled late Friday that Revel has until 4 p.m. Tuesday to respond to the appeal from IDEA Boardwalk of a federal judge’s decision.
IDEA Boardwalk and other former Revel tenants asked U.S. District Court Judge Jerome Simandle to delay the sale but he denied the request Jan. 21, saying that Revel and Atlantic City would be harmed by a delay.
IDEA Boardwalk and the tenants, including restaurants and an on-site power plant that served Revel, say they could be wiped out if the $95.4 million sale goes through as planned. IDEA Boardwalk says it invested $16 million in the HQ nightclub and two bars at the casino.
Michael Viscount, a lawyer for Revel, said that he expects the appeals court will deny IDEA’s request and that the sale will proceed as scheduled by the Feb. 9 closing date.
A bankruptcy court approved the sale to developer Glenn Straub earlier in January. His Polo North Country Club was the first to place a bid on Revel, which cost $2.4 billion to build and which closed in September after just over two years of operation during which it never turned a profit.
Straub has proposed numerous simultaneous uses for the property including a scaled-down casino, a water park, condominiums and a hotel. But he also has threatened to walk away from the deal if the sale is delayed.
His attorney, Stuart Moskovitz, has said Straub may cut his losses at the $10 million deposit and related costs incurred and abandon the deal, just as a Canadian firm originally tapped to buy the casino did last year. In November, Brookfield Asset Management scrapped its purchase deal and forfeited an $11 million deposit.
Moskovitz said in court filings that if the court allows the tenants to challenge the terms of the sale and delay it, Straub could lose millions of dollars and be placed in an almost impossible negotiating position.
Moskovitz wasn’t available for comment Saturday.
Meanwhile, the company that runs Hard Rock casinos for the Seminole Indian tribe won preliminary approval to operate a casino in Atlantic City and chief executive James Allen says he has had conversations with Straub. Allen would not say whether Hard Rock might be interested in being a co-purchaser of Revel with Straub, or the operator or manager of the facility.