ACR Energy Partners claims the new owner of the Revel Casino is trying to flip the property to a new buyer. NJ.com reported the ACR Energy's court documents filed in federal court last Friday claimed that Polo North "refuses to pay for energy services, while it tries to flip the nonoperational complex to a new buyer."
Polo North is owned by Glenn Straub, a South Florida developer who won a protracted bankruptcy auction to become the owner of the Revel Casino. Straub bought the Atlantic City property for $83 million, though Revel cost $2.4 billion to build. The casino was in operation for only 29 months before it closed its doors--after a second bankruptcy.
Dispute over Energy Costs
Since he bought the casino property, Straub has refused to pay the full energy costs to ACR Energy Partners. He won in court the right to pay ACR lower costs until their negotiations were over. Reports in recent weeks suggested the energy company, which had a $3 million per month contract with the Revel Casino, is going broke due to the lower payments.
The filing by the Atlantic City energy company claims that Polo North has decided to engage in a "knock-down-drag-out war rather than negotiate, leading one to conclude that Polo North is just not interested in operating any business or permitting any business to operate in the complex."
Straub Promises to Develop the Casino
For his part, Glenn Straub claims he has every intention of developing the property as a casino enterprise--and perhaps for other purposes. He told the New Jersey newspaper media, "We didn't buy it because we wanted to sell it. We didn't buy it if we weren't going to develop it."
Straub admitted he would sell if someone made an offer "that would turn our heads", but he also said that was the same for any of the properties he owns. For the time being, he wants to turn much of the space into a casino, while renting space of the massive skyscraper to other businesses. How the building is powered is still a major stumbling block to any opening, though.
How the Dispute Began
The arrangement between Polo North and ACR Energy soured almost from the beginning. Just days after Straub bought the Revel Casino, he filed a motion to evict the power company. In an attempt to force Polo North to reach an accommodation, ACR cut off energy to the building.
Soon after, the two sides agreed to an arrangement in which ACR Energy would provide minimal power to the casino, in exchange for lowered payments for that energy. To exert pressure on ACR Energy to negotiate, Glenn Straub went forward with plans to build a solar energy facility to circumvent the need for ACR's power. He also brought in heating equipment, in preparation for a long winter.
Damage from Large Sea Gulls
That is when the impasse veered into the bizarre. In August 2015, several of the massive windows on the Revel Casino were found to be damaged. It was found $36,000 worth of damage had been done to the windows, though the reasons for the damage was unclear.
ACR Energy claimed the glass in the windows were popping out due to the heat on the glass, and called again for Polo North to deal in good faith. Glenn Straub denied the claims the lack of energy had anything to do with the damage. Instead, he claimed the damage had been done by "giant seagulls", then began to discuss how Atlantic City has the largest seagulls he's ever seen.
Straub and ACR in Stalemate
One gets the idea of a siege taking place. ACR Energy Partners wants to speed up the negotiations, while Polo North wants to draw it out as long as possible. In court filings, ACR has complained to the judge, saying the current arrangement is driving the power cooperative into bankruptcy. Meanwhile, Glenn Straub seems happy to leave his building empty, while discussing the city's sea gulls.
Since the besieged seems to be enjoying the long wait, the analogy to a siege might not be right. Perhaps the standoff over Revel Casino might be better compared to a hostage negotiation, with those $3 million energy payments contractually promised to ACR Energy as the howww.
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