Offer by developer and partners will top rival’s by more than USD 100 million
Atlantic City – A New York developer said Tuesday he is putting together a group interested in buying the Tropicana Casino and Resort for USD 950 million.
Joseph Palladino, who said he has been active in the Brooklyn, N.Y., real estate market and is considering a project on a former supermarket site in Brick Township identified himself Tuesday as the second bidder for the hotel-casino.
He said his group, whose name and members he promised to make public within the next several days, is well-known to the casino industry. The Newark Star-Ledger reported on its Web site Tuesday that former New Jersey Secretary of State Joan Haberle is representing Palladino’s group.
„We want to really clean that area up and take the Tropicana back to where it belongs,“ Palladino said.
His group’s offer is USD 100 million more than the only other publicly disclosed bid for the Tropicana, from Colony Capital, which owns Resorts Atlantic City, the Atlantic City Hilton and the Las Vegas Hilton.
Gary Stein, the retired state Supreme Court justice overseeing the Tropicana until it can be sold, said Tuesday he is unfamiliar with Palladino. However, Stein forwarded the offer to Bear Stearns, the New York investment firm helping field offers for the Tropicana.
The state Casino Control Commission stripped the property’s former owners, Kentucky-based Columbia Sussex Corp., of their casino license last month, determining the company was incapable of operating the kind of first-class facility required under New Jersey law.
That mandated a sale of the property, which includes New Jersey’s largest hotel at 2,129 rooms. Stein said he hopes to have a buyer by the end of April. About 25 parties have thus far expressed interest in buying the Tropicana.
Palladino said he has plans for a 200-room resort hotel development project on the site of the former Foodtown supermarket on Route 70 in Brick.
Brick’s business administrator, Scott Pezarras, confirmed the township is talking with Palladino about the site, but said the two sides have not reached an agreement.
The Star-Ledger said Palladino’s USD 950 million proposal was mentioned at a Casino Control Commission meeting last week. But the bidder was unidentified, sparking speculation, the paper said.
Palladino said his group would invest USD 150 million in upgrading the Tropicana, and would seek to rehire many of the 900 workers Columbia Sussex fired last year.
Those job cuts led to problems with service and cleanliness that figured in Columbia Sussex losing its license to run the Tropicana.
According to Hoovers.com, privately held Columbia Sussex had USD 970.4 million in revenue in 2007 and employed 15,000 people at the end of the year.