Billionaire Carl Icahn Closer to Selling Shuttered Trump Plaza in Atlantic City

Posted on: January 7, 2019, 08:13h. 

Last updated on: January 7, 2019, 08:13h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The odds of Carl Icahn unloading his shuttered Trump Plaza Hotel and Casino in Atlantic City and selling the Boardwalk resort built in the early 1980s by President Donald Trump might be increasing.

Carl Icahn Trump Plaza sale Atlantic City
Trump Plaza could have a new owner after Carl Icahn obtained the deed rights to the resort’s land. (Image: Michael Ein/Press of Atlantic City)

The Press of Atlantic City reports this week that the billionaire has successfully removed a complicated legal lease issue that presented issues with selling the resort, which closed its doors in September 2014.

Atlantic County property records show that IEP AC Plaza LLC, a subsidiary controlled by Icahn Enterprises, paid $3 million to Plaza Hotel Management Co. in early December to acquire the deed to the land Trump Plaza sits. The LLC then terminated a $1 million annual land-lease contract that was to run through 2078.

Lifting Lease

Casino.org reported in March 2017 that the land-lease contract was preventing Icahn from selling Trump Plaza. Plaza Hotel Management is controlled by 91-year-old Robert Lifton, the former head of the American Jewish Congress.

Lifton owned the land where Trump decided to build his first casino resort in Atlantic City. Trump agreed to pay Lifton $1 million each year through 2078 to operate the casino on the grounds.

Lifton accepting a $3 million buyout gives Icahn total control of the Boardwalk property, and allows him to move forward with a sale free of a complicated lease contract.

Icahn is departing the gaming industry after selling Tropicana Entertainment for $1.85 billion in 2018.?The year earlier, he sold Trump Taj Mahal to Hard Rock for $50 million, and the unfinished Fontainebleau Las Vegas for $600 million.

Trump Plaza is the only remaining property in Icahn’s Trump Entertainment Resorts portfolio.?Icahn wants to demolish the aging 39-story hotel tower to create prime beachfront land ready for development. He believes the property is worth more without the 600-room hotel.

Tough Forbes estimates his net worth to be more than $16 billion, Icahn is seeking tax money to help him raze Trump Plaza. Projected to cost around $13.5 million, the billionaire wants $5.6 million from the Casino Reinvestment Development Authority to help cover the expense.

New Jersey State Senate President Stephen Sweeney (D-West Deptford) opposes using tax dollars to help a billionaire.

“Carl Icahn is no friend to Atlantic City,” Sweeney (D-West Deptford) said in 2017. “I have serious questions about allowing him to take $5.6 million in funds intended to promote economic development for the city and its residents and instead use the money for his own property.”

Green Acres

Atlantic City is on the rebound, as gross gambling revenue was up for the third consecutive year in 2018. That’s leading to higher property values throughout the region.

Demolishing the Trump Plaza hotel would clear around three acres of land centrally located between Boardwalk Hall and Caesars. And according to current land listings, Icahn’s $3 million deal with Lifton seems to be a bargain.??

A nearly half-acre lot seven blocks north of Trump Plaza is currently listed for sale at $1.5 million. The vacant land isn’t beachfront, but a tenth of a mile off the Boardwalk.