Actually, Morgan Stanley didn’t even get halfway there when they decided to pull out of the stalled Revel casino and hotel in Atlantic City.
Wall Street giant Morgan Stanley decided it was better to take a $932 million loss on a casino-hotel it was developing in Atlantic City than spend the $1 billion it will take to finish Revel.
That’s a big loss, but I guess the outlook for he market makes it wiser to lose half of the investment then the whole thing. I’m sure finding a buyer won’t be easy, but it will be a way to cut the losses even further.
I’m sure there is much more to come with Revel in the future.
Revel is being allowed the possibility of receiving $300 million in tax breaks should they complete construction on the casino that’s about half way done in Atlantic City.
In a move that caught opponents by surprise, New Jersey senators voted Monday to ensure that hundreds of millions of dollars in tax breaks for the Revel Entertainment Group’s Atlantic City casino project cannot be overturned by public petition.
Sure tax breaks for corporations aren’t nice to look at on the surface, but the Atlantic City casino market needs Revel to be completed to compete with the increased competition it’s facing from the surrounding states. If the casino was not completed New Jersey would never see a penny in casino, real estate and other taxes. This is a smart, aggressive move by New Jersey. Something you don’t see very often.
Revel is asking Atlantic City and Atlantic County to put up money to cleaning up the area around the Revel casino.
The deal, still in its early stages, would use a hefty portion of the city’s and county’s annual tax revenue from Revel to finance various improvement projects in the resort’s Inlet section and other areas that would affect the $2 billion megacasino…
Preliminary documents obtained by The Press of Atlantic City show the resort, the Atlantic City Board of Education and the county would each contribute a portion of the $32.5 million they are expected to generate from Revel’s annual property taxes. Normally, that revenue is split in half, with 50 percent for the city and the other half divided evenly between the county and the city school board.
Here’s a look at some of the improvements being asked for.
A draft agreement obtained by The Press of Atlantic City breaks down how the $150 million in infrastructure projects would be allocated. Below are some of the improvements featured in the documents. Officials with Revel and the city have warned that these numbers are likely to be altered.
Boardwalk Reconstruction
Demolition of Boardwalk from Melrose to Caspian avenues
Boardwalk renovation from Rhode Island to North Madison avenues
Price: $36 million
Expansion of Absecon Lighthouse Park
Expand park two blocks to Maine Avenue and the Boardwalk.
Price: $29.5 million
Garden Pier Renovations
Demolish end of pier
Renovate front of pier, Art Center and Historic Museum
Price: $10 million
Road Improvements
Arctic Avenue from Atlantic City Expressway off-ramp to Rhode Island Avenue
Baltic Avenue from Rhode Island Avenue to Atlantic City Expressway off-ramp
Price: $22.7 million
Much of Atlantic City is in need of some kind of repair. Call it gentrification or call it helping a community improve. While this is being asked for by Revel, they won’t be the only people to get something out of these improvements. It’s unfortunate that it takes this kind of business request to clean up the city but I understand why this is bring asked for and why this, or something similar to this, will happen in the next year or so.
The proposal isn’t final, but I can’t imagine it won’t be approved.
Revel casino found a way to secure funding to remain on schedule be finish construction and open in the summer of 2011.
China State Construction Engineering Corp. has signed a $1.7 billion agreement with property firm Tishman Construction Corp. and casino builder Revel Entertainment Group L.L.C. of Atlantic City, to finish the $2.5 billion megacasino planned next to Showboat on the Boardwalk.
Revel is still seeking about $1 billion in funding to complete the project but this deal should bring them closer to finishing the construction.
I’m stoked to see Revel’s owners doing everything they can to finish what they started. Rumors are that Pinnacle is waiting for the real estate market to turn up so they can cut their losses by selling the big bowl of dirt next to Bally’s. Of course, time will tell.
Here’s a video update/tour of Revel in Atlantic City. There doesn’t seem to be any progress in the past few months but this video tour has some nice views.
Revel has been in a slow down of construction for a while. Ownership has changed their target for opening from the summer of 2010 to some time in 2011.
Revel executives once hoped to open by summer 2010, but financing shortages are expected to delay the casino’s debut until 2011.
The goal of completing the outside of the casino and hotel are still in tact as you can see from my last construction update. At least there won’t be an eyesore from half finished construction. Not that many people venture down that far on the boardwalk.
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