ATLANTIC CITY, N.J. (AP) — A New York hedge fund that lent money to Atlantic City's Ocean Resort Casino is assuming ownership of it.
Luxor Capital Group was identified as the new owner in a press release Monday from the casino. The company, which is not related to the Luxor casino in Las Vegas, will take over the ownership interest of Bruce Deifik (DIE'-fick) and his family.
Luxor Capitol will assume control once it receives interim authority to own a casino. Until it gets that approval, which could come within three to four months, a trust will be created for the casino's temporary ownership.
Once Luxor Capital completes a promised $70 million investment into the property, a trustee will be appointed to oversee the trust until the company is deemed suitable to hold a casino license in New Jersey.
The casino-hotel plans to operate normally during the transition. The ownership change comes less than seven months after the property's re-opening.
"We are incredibly proud of the progress our team members have made in establishing Ocean Resort Casino as one of the premier gaming and leisure destinations in the United States," said Frank Leone, the casino's CEO. "We are thankful for the support we have received from the broader Atlantic City and New Jersey community and look forward to an exciting 2019."
Deifik, who earlier this month said he would retain a small, non-controlling interest in the casino, will have no ownership of it at all. In announcing the casino would change hands earlier this month, Deifik said the new ownership would invest $70 million to help get the property through the slow winter months.
Ocean Resort was one of two formerly shuttered casinos that reopened the same day last June, along with Hard Rock.
The reopenings brought Atlantic City's casino total to nine, shortly after five casinos had shut down in a market that could not support them all. The Atlantic Club, Showboat, Revel and Trump Plaza all closed in 2014, and the Trump Taj Mahal closed in 2016. (The Taj Mahal reopened as Hard Rock last year.)
The revival of the two casinos immediately raised questions as to whether Atlantic City was making the same mistake that led to the first wave of shutdowns: having too many for all to thrive.
In its first incarnation as Revel, the $2.4 billion casino lasted just over two years before closing in 2014. Florida developer Glenn Straub bought it out of bankruptcy court for $82 million, and sold it last year to Deifik, a Colorado developer, for $200 million.
Deifik decided to buy the casino sight unseen on the recommendation of his advisers, and set about renovating it, adding an indoor golf facility and one of the state's most extensive sports betting facilities.
He and his management team said they were confident they had fixed what went wrong with Revel. Deifik reconfigured the maze-like casino floor, allowed smoking on it again, welcomed gamblers of all income and playing levels, and placed a premium on customer service.
He took over Ocean Resort with far less debt than what sank Revel. But the casino's gambling revenue remains near the bottom of the pack along Atlantic City's nine casinos.