Thursday, October 16, 2014

Blatstein-Steelman Agree to Buy Caesars Pier

By Joseph N. DiStefano, Inquirer Staff Writer

Philadelphia developer Bart Blatstein said Sunday he and casino architect Paul Steelman had agreed to buy the four-story, 300,000-square-foot, half-empty Caesars Pier shopping center in Atlantic City for a small fraction of its construction cost.

A person familiar with the deal said Blatstein and Steelman agreed to pay $2.8 million. That's less than 2 percent of the $200 million-plus that developer Taubman Centers of the Detroit suburbs and other investors plowed into the project in the mid-00s. The partners hope to close the deal this year.

"I love Atlantic City. I grew up going to the Shore. And this is the best time to buy there," with casinos shutting down and property values cratering, Blatstein said. "For those who think A.C. is done for, they are out of their minds. This is a great opportunity to come back into Atlantic City." He declined to comment on specific plans until after the deal is done.

Taubman had imagined 85 retailers selling Apple smartphones, Baccarat crystal, Gucci and Hugo Boss accessories, Louis Vuitton luggage, and Tiffany jewelry, as well as middle-class clothing brands such as Banana Republic and Guess, and branches of Philadelphia's Buddakan and Continental restaurants would appeal to gamblers looking to spend casino winnings, as well as to other visitors.

But the 2008 recession and the rapid increase in competition from casinos in Pennsylvania and other states crippled Atlantic City retailing.

In 2009, Taubman wrote off $108 million it and others had invested in Caesars, and said it would stop subsidizing the mall's operations; stores began to close. In 2011, a group of lenders foreclosed on the center, canceling $135 million in debt and interest Taubman still owed, and put the glass-walled center up for sale.

Blatstein said he and Steelman weren't planning gambling or residential uses, but were open to other commercial tenants.

Steelman, a Longport native and Atlantic City High School graduate whose clients include gambling mogul Steve Wynn and Brookfield Property Partners L.P., which recently bought Atlantic City's twice-bankrupt Revel casino for a fraction of its construction cost, is also the designer for Blatstein's proposed Provence casino at The Inquirer's former plant on North Broad Street.

"Paul's from down the Shore," Blatstein said. "He's got such a creative, brilliant mind. He's got projects in Vietnam and Macau and Moscow. I love working with him; he sees it all."
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