Stockton University announced Friday afternoon that it would sell the former Showboat casino property to Florida developer Glenn Straub if it cannot overcome obstacles to create an Atlantic City campus there.
Straub's Polo North Inc. would buy the property for $26 million, which is to be placed in escrow for 90 days.
Stockton purchased the Showboat in December for $18 million and has spent additional money securing and preparing the site for occupancy. The university does not expect to profit from a sale.
During the 90-day period, Stockton will work to overcome a legal challenge threatened by Trump Entertainment Resorts to block the conversion into a campus for thousands of students.
"It is my responsibility as president of this university to make decisions in the best interests of Stockton's students, faculty, and staff," Herman Saatkamp said in a statement.
"I do not take that responsibility lightly and believe I have explored the reasonable avenues available, their risks, and their ramifications."
Saatkamp was not available for an interview.
Trump Entertainment said last week that it did not want underage students housed next door to its Trump Taj Mahal casino. The company said it would enforce a 1988 covenant restricting the Showboat property's use to a first-class casino-hotel.
Stockton's plans include reopening a hotel on the site, along with renovating the casino as classrooms, arts spaces, and student housing.
Saatkamp has said repeatedly that little time remains to begin converting the property into a campus. To be ready for some summer classes and a full opening in the fall, he said last week, contracts must be signed by April 12.
If the contracts cannot be signed in time, Saatkamp has said, Stockton cannot afford the security and upkeep costs to hold the property empty for another year. The university would instead sell to Straub, leaving the Galloway Township state-supported school without the "island campus" Saatkamp has long envisioned. There are no plans for creating a Stockton campus in another property, a university spokeswoman said.
The Showboat purchase was his seventh attempt to create an Atlantic City campus, Saatkamp said. The Straub sale agreement covers the university from financial loss, the spokeswoman said, but the school hopes to resolve the issues with Trump.
Stockton also said it would have an 18-month right of first refusal to lease or buy back the Showboat property from Straub. That would let the university try again to build a campus if circumstances change.
Friday's announcement described the Showboat sale as part of a $500 million plan, called the Phoenix Project, that Straub envisions for revitalizing Atlantic City.
"As the name of the project signals, the Phoenix rises out of the ashes to be reborn and will evolve to include a diversified collection of projects including eight parts designed to show that the American dream is still alive and well," Straub said in a statement.
Straub, best known for his ownership of the Palm Beach Polo and Country Club in Wellington, Fla., is scheduled Tuesday to complete his purchase of the bankrupt Revel Casino Hotel for $82 million.
In court Thursday, when a bankruptcy judge approved the sale, the businessman testified that he would immediately start spending $150 million to get the Revel open for the summer season, though it's not clear that he would be able to operate a casino there this summer.
Straub did not return calls for comment Friday.
According to the Phoenix Project statement, the project includes a medical complex with independent living facilities for the elderly and an "entertainment hub."
The Phoenix Project also references the shuttered Bader Field airport, owned by the city. Atlantic City's planning and development board said at a meeting last month that development of the site will take 15 years.
Straub's project envisions a host of facilities there, according to the statement, including an extreme sports complex, two marinas, indoor and outdoor water parks, two universities, and helicopter service to Manhattan.