Posted on: December 23, 2022, 03:16h.
Last updated on: December 23, 2022, 03:46h.
The odds of Fontainebleau Las Vegas being finished have greatly improved. That’s after the development company behind the longstanding Strip eyesore secured financing to complete the multibillion-dollar venture.
First envisioned in 2005, the 67-story blue tower remains unfinished 17 years later. The casino has switched hands several times.
The longest owner was billionaire Carl Icahn, who purchased the bankrupt project in 2010 for $151 million. Icahn had no intentions of finishing Fontainebleau, as he instead opted to hold on to the property until he found a buyer willing to pay much more than he did.
Icahn made a return, though it took seven years, when he sold the unfinished resort to Steve Witkoff and his Witkoff Group for $600 million in 2017. Witkoff intended to finish the casino and open it as The Drew in an ode to his late son Drew Witkoff, who died of an Oxycodone overdose in 2011.
But Witkoff cited COVID-19 for ultimately rendering his Las Vegas Strip dreams unattainable. He sold the property to Jeff Soffer’s Fontainebleau Development and Koch Real Estate Investments (KREI) in early 2021 for an undisclosed sum.
Fontainebleau Financing Found
Soffer was part of the Fontainebleau Las Vegas original development group. Soffer’s family owns the Fontainebleau Miami Beach, one of the first integrated resorts in the US. That opened in 1954.
Soffer sought to bring the Fontainebleau brand to Las Vegas. But Soffer’s Las Vegas development arm filed for bankruptcy in June 2009 after completing about 75% of the sprawling casino resort.
Soffer is backed by a much richer developer this time around in Koch Real Estate. A subsidiary of Koch Industries, a privately held multinational conglomerate based in Wichita, KREI had little trouble in securing the roughly $2.2 billion needed to finish Fontainebleau Las Vegas.
KREI and Fontainebleau Development confirmed today that the partnership has secured the $2.2 billion through a financing group. The casino’s final financing round will be bankrolled by JP Morgan, Japan’s SMBC bank, Blackstone Real Estate Debt Strategies, Goldman Sachs, Guggenheim Partners, and VICI Properties. VICI is the real estate investment trust of Caesars Entertainment.
Securing $2.2 billion in financing in today’s market speaks to the widespread confidence in this project, and the team that’s come together to bring it to Las Vegas,” said Jacob Francis, president of KREI.
“We are eager to bring our iconic Fontainebleau brand — timeless beauty, unparalleled service, and innovative design — to the Las Vegas Strip,” added Fontainebleau Development President Brett Mufson.
Casino Details Unknown
Fontainebleau Las Vegas spans 25 acres of prime real estate on the Las Vegas Strip. Once finished, the destination will feature approximately 3,700 luxury guest rooms, more than a half-million square feet of customizable convention and event space, and a “world-class collection” of dining, retail shopping, and health and wellness experiences.
Specifics on the Fontainebleau casino remain vague. The overall size of the gaming space, as well as the number of slot machines and table games, has not yet been revealed.
Fontainebleau Development and KREI hope to open Fontainebleau Las Vegas by the end of 2023.
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