Lenders allege $13.6 million in missed payments on a $48.5 million mortgage, while the developer continues pursuing a major new event center.
ATLANTIC CITY, N.J. — Showboat Resort owner Bart Blatstein faces a potentially decisive court hearing Friday, November 6, in a foreclosure dispute involving a portion of his Atlantic City property, even as New Jersey officials have canceled a previously approved $4.2 million grant because outstanding liens were not resolved.
The latest developments represent a significant escalation in a financial dispute that Blatstein publicly downplayed during an August interview on News Talk 1400 & 92.3 WOND.
At the time, Blatstein told Scott Cronick that the dispute with his lender was being resolved and insisted he remained committed to Atlantic City.
"This is just due with a lender, and it's being resolved as we speak," Blatstein said during the August 27 interview. "And it will be resolved, and it's a moot point."
More than two months later, the foreclosure litigation remains active.
According to an October 31 report by The Philadelphia Inquirer, Computershare Trust Company, acting on behalf of investors holding commercial mortgage-backed securities, is seeking a court ruling that could move the property toward a sheriff's sale.
The lender alleges that Showboat has failed to make approximately $13.6 million in required payments on a $48.5 million mortgage dating to October 2022.
The alleged payment defaults began in April 2025.
A judge is scheduled to consider the lender's motion for summary judgment on November 6.
A ruling in the lender's favor could advance the foreclosure process, although it would not necessarily mean the resort would close immediately.
Which Showboat Properties Are Involved?
The foreclosure action does not cover the entire Showboat complex.
The mortgage is secured by the 475-room hotel, Lucky Snake Arcade and approximately 1,950-space parking garage.
The adjacent Island Waterpark and a separate residential tower are financed separately and are not directly included in the foreclosure action.
That distinction is important because the resort operates several businesses under the Showboat name.
Showboat's attorneys have emphasized that the property remains operational and continues to serve hotel guests and visitors.
In court filings previously reported by Casino.org, Showboat's legal team said the complex had served approximately 1.2 million guests, customers and event attendees during the preceding 12 months and supported approximately 500 direct and indirect jobs.
The figures were presented by Showboat and have not been independently audited in the reporting reviewed by South Jersey NewsBeat.
The lender, however, argues that the property's continued operation does not excuse missed mortgage payments or other alleged defaults.
State Terminates $4.2 Million Grant
The foreclosure proceedings are not the only financial setback.
The New Jersey Economic Development Authority has terminated a $4.2 million Atlantic City Revitalization Grant previously approved for Showboat.
The grant was awarded in December 2024 to support additional family-oriented attractions and improvements, including expansion of the Lucky Snake entertainment offerings.
According to The Philadelphia Inquirer, NJEDA spokesperson Chris Flores said Showboat was required to satisfy outstanding liens against the property by September 30, 2026.
The deadline passed without the requirement being met.
"Showboat failed to meet this deadline and the grant was terminated," Flores told The Inquirer.
The grant had been approved but had not been disbursed.
Its cancellation therefore does not mean the state is attempting to recover $4.2 million already paid to Showboat.
It does mean a significant source of anticipated public financial assistance is no longer available under that award.
The development is particularly noteworthy because public subsidies and financial assistance for Showboat have been subjects of debate among Atlantic County political figures.
Blatstein Previously Defended His Investment Record
During his August 27 appearance on Off The Press with Scott Cronick, Blatstein rejected suggestions that the foreclosure case represented a retreat from Atlantic City.
"I'm not going anywhere," Blatstein said. "Atlantic City is where I'm staying and I'm going to keep on investing."
He acknowledged that development projects sometimes encounter financial difficulties.
"Sometimes in business, things go south temporarily," he said. "That's what that's about."
Blatstein also insisted that business at Showboat was improving.
"We're up. There's no question about it," he told Cronick. "Our numbers are up."
He credited marketing efforts and the regional draw of the indoor waterpark.
"Water parks pull from three hours away," Blatstein said.
Those comments were made before the latest court developments and the state's termination of the grant.
They remain relevant because they demonstrate how Blatstein characterized the property's financial condition while the lender was already pursuing foreclosure.
South Jersey NewsBeat has not obtained a new statement from Blatstein addressing the November 6 hearing or the canceled grant.
The Inquirer reported that Blatstein did not respond to its repeated requests for comment.
Lender Alleges Additional Defaults
The foreclosure complaint includes allegations beyond missed mortgage payments.
According to court filings reviewed and described by The Inquirer, the lender contends that Showboat failed to complete required hotel room renovations and mold remediation.
The lender also cited contractor liens, unpaid taxes, insurance obligations and business-registration issues.
New Jersey filed a lien for approximately $401,769 in unpaid taxes, according to documents cited in the lawsuit.
Showboat's attorneys dispute the lender's portrayal of the property's condition.
They have argued that certain tax, insurance, lien and registration matters have been resolved, substantially addressed or remain under active attention.
They also contend that mold issues were confined to a valet parking garage and a restricted grease-collection area rather than guest rooms, restaurants or entertainment spaces.
Those competing claims remain part of the litigation and should not be treated as established findings by the court.
The lender has sought the appointment of a receiver to assume control over operations and protect the mortgage collateral.
Showboat has opposed removing existing management, arguing that such an action could seriously disrupt an operating hospitality business.
The legal dispute centers on whether the lender is entitled to move forward with foreclosure and what control should be exercised over the property during that process.
State Financial Assistance Under Scrutiny
The terminated $4.2 million grant is only one element of Showboat's history with state-supported development financing.
In 2019, the Casino Reinvestment Development Authority designated the Showboat project as a retail and entertainment development eligible for annual sales-tax rebates of up to $2.5 million over 20 years.
In December 2025, the adjacent Island Waterpark obtained a $45.5 million financing package through New Jersey's Commercial Property Assessed Clean Energy program, commonly known as C-PACE.
That financing was intended to recapitalize debt associated with construction of the approximately $100 million indoor waterpark.
The C-PACE financing is separate from the mortgage now at issue in the foreclosure case.
The Inquirer reported that NJEDA officials determined the waterpark financing could proceed because prior litigation had either been resolved or did not disqualify the applicant.
The distinction between grants, tax incentives and financing is important.
A grant generally provides direct financial assistance, while a C-PACE loan must be repaid through a property-assessment mechanism. Tax rebates are also different from direct cash grants.
The various programs should not be combined into a single figure suggesting that all represented money given outright to Blatstein.
During his August WOND interview, Blatstein emphasized that some Showboat improvements had been financed privately.
"We did a lot of work this year," he said, referring to improvements along the Boardwalk.
"It happened later than I hoped, but it was all done privately. There were no tax credit money for it."
He also defended his broader development record.
"I believe in Atlantic City, as anybody will tell you, and I do put my money where my mouth is," Blatstein said.
New Event Center Still Moving Forward
Despite the foreclosure litigation, Blatstein is pursuing another major entertainment project near Showboat.
Plans submitted to the Casino Reinvestment Development Authority call for a temporary, approximately 143,000-square-foot indoor event center on a parking lot across Pacific Avenue from the resort's main garage.
The facility would consist of large tent-like structures capable of accommodating sporting events, conventions, trade shows and other gatherings.
Potential uses include volleyball, basketball, wrestling, cheerleading competitions and other events intended to attract visitors during traditionally slower periods.
The project received a land-use hearing on October 15.
A CRDA vote is scheduled for November 17, just 11 days after the foreclosure hearing.
The two proceedings create an unusual situation: a developer seeking approval for a major new attraction while lenders are simultaneously asking a court to foreclose on a portion of his existing resort.
CRDA officials have indicated that required taxes must be current before construction permits can be issued and that applicants must establish their legal authority to develop the property.
The pending foreclosure could therefore raise additional practical questions about the proposed expansion, depending on the court's ruling and the status of the land involved.
The event-center application is a land-use proposal, not proof that additional state financing has been requested or approved for that project.
Political Criticism Has Intensified
Blatstein's financial disputes have drawn criticism from both Republican and Democratic political figures in Atlantic County.
Atlantic County Republican Chairman Don Purdy questioned the developer's continued expansion during a September appearance on Off The Press with Scott Cronick.
"Either get rid of it or try to fix what you have," Purdy said.
Purdy argued that developers should address financial problems at existing properties before undertaking additional projects.
"I like people who have vision," he said. "I like that, especially with Atlantic City, but you can't use other people's monies to do it, and you can't expect businesses to take hits on the chin with it."
Former Atlantic County Democratic Chairman Michael Suleiman has also publicly questioned the use of state financial incentives for developers facing unpaid contractor claims and other financial disputes.
Their comments reflect political criticism, not findings that Showboat violated the requirements of any particular state assistance program.
Atlantic City Mayor Marty Small, meanwhile, has defended Blatstein.
"I'm a big believer in Bart Blatstein," Small told The Philadelphia Inquirer. "I know he loves Atlantic City and we love him."
The competing views reflect a broader debate about Atlantic City's redevelopment strategy and the risks associated with large private projects that also rely on public economic-development programs.
What Happens November 6?
The immediate focus is the foreclosure hearing scheduled for Friday.
Computershare is asking the court to grant summary judgment, a legal ruling that could allow the foreclosure to advance without a trial on disputed issues the court determines do not require one.
A favorable ruling for the lender could set the stage for further foreclosure proceedings and potentially a sheriff's sale.
However, the November 6 hearing is not itself an announced closing date for Showboat.
The resort continues to operate, and its attorneys have argued that maintaining existing operations is important for employees, visitors and creditors.
The court could grant, deny or otherwise address the lender's motion, and the parties could still reach a negotiated resolution.
For Blatstein, the hearing represents a major test of the assurances he offered publicly in August.
"We're going to keep on developing," he told Cronick at the time. "We're going to keep on trying to make a difference and to help Atlantic City out."
Whether the developer can continue that expansion while resolving the mortgage dispute is now a question with potentially significant consequences for one of Atlantic City's largest noncasino entertainment properties.
The next major dates are November 6, when the foreclosure motion is scheduled for consideration, and November 17, when CRDA is expected to vote on the proposed event center.
South Jersey NewsBeat will continue following both proceedings.
About the Author
Peter Killeen
A 25-year radio news veteran, Peter covers South Jersey for NewsTalk 1400 & 92.3 WOND radio. Known for his concise and impactful delivery, he ensures listeners and readers stay informed without unnecessary filler.
