A federal bankruptcy judge on Tuesday approved the sale of Atlantic City's former Revel Casino Hotel for 5 cents on the dollar to a Toronto asset management firm.
Judge Gloria Burns approved the sale to Brookfield Asset Management for $110 million.
She turned aside numerous objections from the losing bidder, Florida developer Glenn Straub, who complained that Revel's lawyers reneged on a promise to share information on competing bids, something Revel has denied.
“The best news is Revel is going to reopen as a casino,” said John Cunningham, one of Revel's attorneys. “It's not going to be a university.”
That was a thinly veiled swipe at one of the offbeat uses Straub had proposed for the property, including a so-called genius university where the world's top minds would attack the planet's biggest problems _ with or without a casino.
Although Straub said he intended to make a higher bid, he did not do so during the auction and declined to do so at Tuesday's hearing. Cunningham said the company decided to take Brookfield's bid in an all-night auction rather than wait for a possible new bid by Straub a week later.
“This is a disgruntled losing bidder,” he told the judge. “Mr. Straub had to put his money where his mouth is. He didn't do it. Our decision was to take the bird in the hand. It was too much money to risk.”
Revel president Scott Kreeger said he was “excited by the decision of the court.”
“We conducted a comprehensive sale process that maximized the value to the estate,” he said. “Brookfield is a highly regarded company with extensive gaming experience. Their experience would give Revel a strong new owner with whom to chart a new course for success.”
The casino cost $2.4 billion to build and never turned a profit. It closed Sept. 2 after just over two years of operation.
It was one of four Atlantic City casinos to go out of business this year, and a fifth, the Trump Taj Mahal, could close Nov. 13.
During the auction, Straub complained that he suffers from a serious medical issue and had left his medication in Florida, jeopardizing his health. He didn't specify what kind of medical issue he had.
“I was wandering up and down the streets, which is what caused my medical condition,” Straub told the judge in complaining about the duration of the auction and the 6 a.m. deadline that Brookfield set for acceptance of their bid. “It was cold, high anxiety. This is life and death here. How can they keep continuing to do this?”
Straub also objected to being told at 3:45 a.m. that any new bid he might make had to be received by 5 a.m. because Brookfield made its bid contingent on being accepted by 6 a.m. He said he couldn't reach his financial advisers at that hour.
“I don't know if I knew my name at 5:30 in the morning,” he said.
Straub's attorney said he remains interested in other development opportunities in Atlantic City.
In approving the sale, Burns said the auction had been run properly. She set Oct. 20 as a hearing date for numerous unresolved legal issues in the case.
Cunningham said Revel and Brookfield expect to close on the deal within 60 days.
Brookfield spokesman Andrew Willis said the company plans to run Revel as a casino, but he wouldn't comment on other plans for it.