Glenn Straub Won the Right to Buy Revel Casino, But Wants It for a Lower Price
Glenn Straub and Polo North Country Club won the right to buy Revel Casino for $95.4 million on Monday. On the same day, Straub announced he was go to court to halt the sale to himself.
After Brookfield Management of Toronto announced it would pull out of its $110 million purchase of Revel Casino, Straub is the only bidder remaining in the bankruptcy auction process. In Straub’s way of thinking, if Brookfield’s role in the auction process was voided, then he should get the property for the original price he offered: $90 million.
Because Straub was paid the stalking horse fee of $3 million for losing the bid–and because Revel Casino’s owners are keeping the $11 million deposit paid by Brookfield–Straub is deducting that $3 million fee from the price and claiming he should be able to purchase Revel for $87 million.
Revel Casino Lawyers Are Flabbergasted
The owners of Revel Casino seem to be beside themselves with dismay. That’s what their lawyers are conveying to the press, anyway. John Cunningham, a lawyer for Revel Casino, told ABC News, “This is a most unusual sale motion in that we have an objection by Polo North to their own sale. I think in my 23 years of practicing bankruptcy law this is my first time to see that.”
Earlier, Straub’s lawyer, Stuart Moskovitz, filed a motion with U.S. Bankruptcy Judge Gloria Burns that would have allowed Polo North to make the purchase for $87 million. Judge Burns refused that motion and instead ruled that Polo North needed to pay the full $95.4 million, because the auction process was binding.
Filing a Motion to Fight Purchase
After that ruling, Moskovitz said he would file a motion with an appellate court to have the issue a stay on Judge Burn’s order to sell Revel Casino at that price. Stuart Moskovitz asked the judge to issue a stay of her own order, but Judge Burns refused to do so. When asked by media members during a break in the court hearings what Straub’s next move was, Moskovitz said his client “is not making any decisions right now.”
In Florida, Glenn Straub has been involved in a number of lawsuits. In June 2014, he filed a lawsuit against Wellington, which runs the Acme Improvement District, because Wellington unleashed 100 million gallons of water from the Big Blue cypress preserve onto 20 acres of the Palm Beach Polo and Country Club.
Wellington has a permit from the South Florida Water Management District to dispense water in the area. From 2010 to 2012, Straub was involved in a lawsuit in which he was accused of bulldozing wetlands, though Straub was found “not guilty”, after he claimed they had only removed vegetation and not soil.
Plans for Revel Casino
Glenn Straub is not willing to say what he will do with Revel Casino, if it becomes his property. Earlier, he suggested he would use it as a rail link, though he held the door open that some gaming activities might take place there. He later hinted that he might open a “genius academy” on the grounds, in which academics would try to solve international problems.
Though Straub sounds like he would not be too upset if the deal fell through entirely, he has suggested he would continue to be a developer in the area, perhaps to open some “wineries and country clubs”.
Straub “Will Not Engage”
Lawyers for Revel Casino hoped to discuss with Straub and his lawyers the final language in the sale contract, but Cunningham said “will not engage. They feel they need more consultations with experts. He continues to tell us he’s going to appeal your order.”
According to one source, Mr. Moskovitz told the judge that Glenn Straub needed a few days to consult with others about the purchase, including other non-gambling residents of the Revel building. The lawyer also said Straub did not plan to file a motion before Thursday, which might imply that he still holds out hope of declining to file after those consultations.
Claims Bidding Process Was Tainted
The reason given by Polo North for asking the judge to void the auction was the contention that “the entire bidding process was tainted.” It was later learned that lawyers who represented Revel Casino had also represented Brookfield Management on unrelated matters.
Revel’s Cursed History
Revel Casino has had a cursed history, in many ways. The $2.4 billion skyscraper was in the middle of construction when the Great Recession hit, so the developers ran out of money halfway through construction. J.P. Morgan walked away from a $900 million investment before the casino opened. After Revel opened, it went through two bankruptcies, despite being in operation only 29 months.
Along the way, strange and sometimes tragic events have happened. Three Revel executives died in a plane crash. It was Revel Casino where NFL star Ray Rice had his altercation with his then-fiance. When video emerged of their elevator fight, it changed the course of his career and forced the NFL to institute new policies. Now two bidders joined in Revel’s bankruptcy auction, but one has walked away and the other is now filing a motion to fight their own purchase of the property. Already, Glenn Straub is purchasing a $2.4 billion structure for $95 million, less than 5% of its original cost.
