ATLANTIC CITY, N.J. – Atlantic City's former Trump Plaza casino is likely to remain closed for at least 10 years following a judge's approval Thursday of a deed restriction prohibiting anyone from re-opening it as a casino.
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Delaware bankruptcy court Judge Kevin Gross approved the deed restriction imposed by Trump Entertainment Resorts on the former casino, which shut down on Sept. 16, the last of four Atlantic City casinos to do so last year.
The restriction prevents anyone from re-opening Trump Plaza as a casino for 10 years, although it could be used for a non-gambling purpose. It was done to avoid potentially higher taxes under a bill Gov. Chris Christie could sign soon allowing casinos to make payments in lieu of taxes for 15 years.
The bill applies to any property that was licensed to operate as a casino in 2014 and that does not have a deed restriction. Trump Plaza operated for 8½ months during 2014, and the company feared it might be included in the alternative tax program.
The company already has appealed its 2014 and 2015 property taxes and believes it can get a better deal through that appeal than if it were forced to participate in the PILOT program. Once the PILOT plan is enacted, assuming Christie signs it into law, casinos would be prohibited from appealing their property taxes.
Caesars Entertainment placed a similar deed restriction on the former Showboat Casino Hotel before shutting it down last August. That deed restriction was enough to keep the Showboat out of the PILOT program. Figures calculated last December by the surviving casinos did not include Trump Plaza in the PILOT program.
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The deed restriction could be canceled if a buyer is willing to pay Trump Entertainment an unspecified "release fee" to cancel it. Company CEO Robert Griffin would not say what the price would be to cancel the deed, and he declined to comment on the judge's approval of the deed restriction.
Billionaire investor Carl Icahn, who is in the process of buying Trump Entertainment out of bankruptcy court, approves of the deed restriction, according to a Trump Entertainment court filing.
Whether anyone would even want to buy Trump Plaza for a purpose other than knocking it down remains unclear. Trump Entertainment tried for years to sell the property while it was still a casino. A February 2013 deal to sell it to a California company for $20 million — what would have been the lowest price ever for an operating casino — fell through within a few months.
Several casino executives and analysts have said the property would be more valuable if the casino were razed to make way for the possible expansion of The Walk, Atlantic City's outlet shopping district, or for some similar non-gambling purpose.
Wayne Parry can be reached at http://twitter.com/WayneParryAC