Struggling Atlantic City received a spot of good news with plans to reopen the shuttered Revel Casino Hotel next year under new ownership.
A report issued Monday by the Moody’s Investors Service corporate finance team said an ownership group called AC Ocean Walk led by developer Bruce Deifk plans to buy the former casino for $200 million and invest another $175 million before a planned May 2018 reopening.
The casino closed in September 2014 after declaring Chapter 11 bankruptcy and has been owned by Florida-based developer Glenn Straub since 2015. Moody’s said the original Revel cost around $2.6 billion to build when it opened in April 2012 under much fanfare as part of a plan to revive Atlantic City gambling.
The Moody’s report said AC Ocean Walk will includes 100 gambling tables, 2,000 slot machines, pools, a spa, nightclubs and 13 restaurants. The facility will also include 55,000 square feet of retail space along with a parking garage with more than 7,000 spaces.
“The property is expected to slowly capture its fair share of the market given the quality of the property—(originally opened in 2012), breadth of project offerings and a revamped operating strategy aligned with the demands of patrons in the market,” said Moody’s analyst Peggy Holloway in the report.
Revel was among five Atlantic City casinos to close since 2014 as the Jersey Shore gambling hub suffered from a saturated gambling market and regional competition from nearby Pennsylvania. The city, with junk ratings of CCC-plus from S&P Global Ratings and Caa3 from Moody’s, issued $138 million in bonds earlier this year through New Jersey’s Municipal Qualified Bond Act program to finance casino property tax appeal settlements.
Atlantic City has faced state intervention since November 2016 under the Municipal Stabilization and Recovery Act that empowers New Jersey’s Department of Community Affairs under designee Jeffrey Chiesa to alter outstanding debt and municipal contracts. The city, which nearly averted defaulting on its debt before the state takeover, will have a new mayor in January after Democratic Councilman Frank Gilliam defeated incumbent Donald Guardian in November.
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Corrected December 22, 2017 at 10:55AM: An earlier version gave the wrong S&P rating.