Revel to Reopen as Casino After Sale to LV Hard Rock Owners
After two bankruptcies during its two year existence Revel Casino has a new owner, and the $2.4 billion property is expected to reopen as a casino. The question is, will the new owners be able to turn the Revel around?
After Florida developer Glen Straub declined to up his $90 million bid on the now-closed Revel Casino in Atlantic City, the Revel was awarded to Brookfield Asset Management (A Canadian firm that owns the Hard Rock Casino in Las Vegas and the Atlantic Casino in the Bahamas) after the company offered $110 million for the casino: essentially pennies on the dollar for the casino.
Straub made several appeals to have the bid thrown out, but to no avail.
On Tuesday, October 7th, Judge Gloria Burns approved the sale to Brookfield, saying, “The sale was properly conducted and was fair,” thus ending the short-lived, but extremely fascinating era of Glen Straub.
Despite Straub’s objections that the bids were not made public Judge Burns stated, “You have to prove to me there was some kind of collusion or fraud … and I haven’t heard that today.”
Brookfield’s Plans For Revel
Brookfield has stated its intention to reopen the Revel as a casino, but beyond that (remodeling, potential dates to reopen the property, and any other potential changes) the company’s plans are unclear.
It’s also unclear if the 3,000 Revel employees who were terminated following the closure of the casino would be brought back or given preferential treatment in the hiring process, but Brookfield will have a lot of applications considering the Revel was one of four casinos to close in Atlantic City this year.
One thing Brookfield will likely do that the previous owners were uninterested or incapable of doing (due to their precarious financial situation) is create an online gambling site.
This wouldn’t be Brookfield’s first overture into online gambling.
In November of 2012, the Hard Rock Casino applied for an online poker license in Nevada – the company has not been approved at this point – which shows a general willingness to get involved in the industry. If Brookfield applies for an online gaming license in New Jersey it’s likely there will be a renewed effort to secure their Nevada license as well.
Online gambling at Revel would provide a far more lucrative business opportunity than Nevada, considering the size of the state. The ability to launch both poker and casino games, and the potential to eventually partner with a Nevada site should New jersey enter into an interstate agreement with Nevada down the road might make Revel an attractive partner for an online poker company.
Straub’s Bizarre Antics
As mentioned above, Straub’s short run in Atlantic City was downright Trumpian in its eccentricities and fantastical claims.
Had Straub raised his bid to best Brookfiled it’s unclear if he would have won the auction, as his suitability was likely being questioned.
Straub, made the first of many strange statements after his initial bid was approved and the auction, announcing his intention to host sporting events (from skateboarding racing to women’s basketball) and to turn the Revel into a “Tower of Geniuses” where the greatest minds would work on the world’s biggest problems
Straub later narrowed down his “geniuses” to people with few obligations, using the eyebrow raising description of, “Free, white and over 21.”
Straub also characterized his interest in Revel as a hobby, telling the Press of Atlantic City’s Ruben Kramer, “I need something to do. I need a hobby,” during a break in the hearing to determine if Straub’s $90 million bid would be approved.
Then there was Straub’s comments as the auction lingered into the wee hours of the morning, telling Judge Gloria Burns he was suffering from an unnamed medical crisis. Straub complained he had forgotten his medicine in Florida and had been “wandering up and down the streets trying to find drug stores open. I don’t even know if I knew my name.”
Straub ‘s behavior had many wondering if his initial bid and subsequent off-the-wall comments were merely a case of the businessman sabotaging his own offer, as Straub would be awarded a $3 million payment for acting as the “stalking horse” if he was outbid, a term that describes someone who gets the bidding started.
Whatever his intentions, the Revel now belongs to Brookfield Asset Management, and will soon begin its next chapter in Atlantic City.
