ATLANTIC CITY Owners of the 800-key Atlantic City Hilton Casino Resort are engaging in a legal battle to stave off foreclosure on Atlantic City’s smallest gaming resort.
The property is in default on its mortgage, and lender U.S. Bank National Association has filed a motion asking for permission to foreclose. A court hearing is set for January 19 while the lender and the resort’s owner, Resorts International Holdings LLC, attempt to negotiate a settlement.
The Hilton was late on US$39.3 million worth of mortgage payments as of September. Along with sister properties in Mississippi—Resorts Casino Tunica and Bally’s Casino Tunica—Resorts International holds a mortgage for US$500 million on the three-property portfolio.
Attorney Gilbert Brooks, which represents Resorts—an affiliate of Colony Capital LLC—promises a drawn-out legal battle. “There’s a lot of complexity to it, depending on what happens,” Brooks tells The Press of Atlantic City.
The Hilton posted a US$4.7 million operating loss in the third quarter and is US$19.1 million in the red through the first nine months of 2010. It has lost more money this year than any other Atlantic City casino.
Landry’s Restaurants Inc., owner of Golden Nugget Las Vegas Hotel, has expressed an interest in buying the Hilton to rebrand it as a Golden Nugget property. The property was originally known as the Golden Nugget when Steve Wynn opened it in 1980.