A U.S. bankruptcy judge approved on Monday the sale of the shuttered Revel Casino Hotel in Atlantic City, New Jersey, to a Florida developer for $95.4 million, a price the buyer said he now doesn't want to pay.
Judge Gloria Burns in Camden, New Jersey, approved the sale to Glen Straub but rejected his argument that the price should be cut to $87 million because the auction process was tainted by conflicts and a lack of transparency. Straub's attorney said he will appeal the ruling.
Lawyers for Revel, which cost $2.4 billion to build, sought approval to sell the casino to Straub's Polo North after an affiliate of Brookfield Asset Management which walked away last month from its $110 million agreement for the hotel. Money from the sale will help pay Revel's creditors.
During a break in the hearing, Straub and his attorney declined to say whether they would close the deal. Straub said Revel was just one project of many he had planned for the Atlantic City region.
"This is a most unusual sale motion in that we have an objection from Polo North to their own sale," John Cunningham, a White & Case attorney who represents Revel, told the court. "In my 23 years in practicing bankruptcy, I have yet to see that."
Atlantic City has been hard hit by legalization of gambling in surrounding states. Four of the city's 12 casinos closed in 2014, and three more are owned by a unit of Caesars Entertainment Corp that is expected soon to file for bankruptcy.
Revel was conceived as a Las Vegas-style resort that emphasized high-end dining and eye-catching design over bus tours that other Atlantic City casinos have relied upon.
The casino filed for bankruptcy in June and closed in September. Its ongoing difficulties were on full display Monday.
Straub has said he wants to use the 1,400 room hotel as a think-tank to address social issues such as hunger.
If Straub closes the purchase, the hotel may not have heat. His team has said they will buy the hotel free of its contracts, including its agreement with ACR Energy Partners, the hotel's only utility.
Brookfield said it walked away over a dispute related to the utility contract.
"We can do anything," Straub told reporters when asked how he planned to operate the building without heat.
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