Since the purchase of the now retired Showboat Casino in Atlantic City, Stockton University has doled out close to $8 million on the property in just short of a year according to records.
After the due diligence period ended last month the University announced that Philadelphia developer Bart Blatstein’s Tower Investments would purchase the bankrupt casino along New Jersey’s shoreline for $22 million. If the November 9 closing comes to fruition, Stockton will be on the short side of its $26 million investment by nearly $2 million, according to local press.
Subsequent expenses from the purchase that include monthly maintenance costs estimated between $400,000 and $500,000 have Stockton and its Interim President Harvey Kesselman imagining ways for the school to compensate for the approximate $2 million difference, including a complaint filed back in May against Caesars Entertainment Operating Co. According to Kesselman, students will not be made to bear the burden of any money not recouped. The salaries and benefits paid to about 40 security and maintenance workers kept on from the Showboat account for the University’s largest expense at $1.65 million.
Still profitable within the Atlantic City casino market, the Showboat Hotel and Casino was closed last year by then owner Caesars Entertainment in order to reduce competition in the Atlantic City gambling market which was struggling. Believing that it would be released from a covenant requiring the site be used as a casino, Herman Saatkamp, the University of Stockton’s president at the time purchased the property for $18 million later in 2014. The university had hoped that the property could be converted into an Island Campus and privately run hotel, but refusal by Taj Mahal owner Trump Entertainment Resorts to waive the covenant and competing legal claims have prevented that from happening.