An Update on the Stoboat Debacle
In a previous piece, we discussed the current state of affairs regarding Stockton University’s purchase of the former Showboat property. The university’s plan for the property was to develop it into a satellite campus, complete with student housing, classroom space, and areas for student performances as well as an operational hotel and resort for paying guests. The project was slated to be complete by the summer of 2015 and ready to open as a fully functional campus by the fall. However, the university and its president, Herman Saatkamp, faced one huge snag: a 1988 covenant made between Caesar’s Entertainment, Trump Entertainment Resorts, and Resorts Casino Hotel that required all three properties only be operated as first-class casino resorts. Trump Entertainment Resorts opted to uphold this covenant, blocking Stockton from pursuing its plan.
All seemed lost. Then, casino tycoon and recent buyer of Revel, Glen Straub, stepped in and offered to purchase the property from Stockton in the event it could not resolve its issue with Trump Entertainment Resorts. Well, it looks like Straub is going to be the Showboat’s new owner.
Trump Hasn’t Won – Yet
Amid the controversy, Stockton’s president announced that he will be stepping down from his post on or after August 31st.
When Caesar’s sold the property to Stockton College, it specified that the property not be used as a casino. Now the case needs to be examined further to determine whether this is legally enforceable as Trump Entertainment Resorts refuses to budge regarding the 1988 covenant. As it turns out, the purchase’s information was never submitted to the state Comptroller’s office. University purchases of $10 million or more are required to be reviewed by the state Comptroller to ensure that they comply with state and federal laws and regulations. Now, the office must review the purchase to determine whether or not the covenant may be upheld.
Stockton University has until July 3rd to back out of its agreement with Straub. Unless the involved parties can work out a plan for the property, the case will go to court. We will keep updating this story as it develops.