We’ve called the Revel Casino saga in Atlantic City a roller coaster ride of epic proportions. But today we think ‘unpredictable volcano’ is a more appropriate analogy.
On the eve of a deal being finalized between Revel and potential new owner Glenn Straub, a new bidder has stepped forward with a bid that’s $2 million less than what Straub offered. And it might just beat out the higher bid. Here’s the back-story.
Revel opened its doors in 2012 to the tune of $2.4 billion in construction costs. The boardwalk casino didn’t attract the guests they needed to make a profit. A number of factors led to their demise, including their non-smoking policy. Gamblers love to smoke and Revel forced patrons off the property to enjoy a cigarette.
Revel also made it hard for hotel guests and people off the street to actually find the casino. You had to go down a series of elevators or escalators and pretty much guess where the casino was. A lack of signage didn’t help.
The casino closed its doors in September 2014 after the owners declared bankruptcy. Towards the end of the year, Canadian property management company Brookfield Properties made an offer to buy Revel for $110 million.
But before that deal could be finalized, Brookfield backed out. Brookfield had beat out Florida develop Glenn Straub, who had bid over $90 million. After Brookfield backed out, Straub’s deal was also declared dead by a bankruptcy paving the way for Straub to bid again. He did so, entering in a bid of $82 million.
The deal was expected to go through, but now a new bidder has come forward. A Los Angeles developer, Izek Shomov, has entered a bid of $80 million. While its $2 million less than Straub’s bid, it might actually be more attractive.
Straub wants all existing leases canceled. Shomov says he’ll honor the leases with the previous tenants, including any restaurants and service that might have existed on the property.
We’re not sure what will happen, but Shomov’s bid is arguable more attractive in an economy that has suffered significant job losses. Letting tenants operate as they had been is sure to boost the confidence of the battered seaside resort town.
We’ll keep our eyes on this story as it develops, so stay locked to Silver Oak Casino for all the important details.