Fontainebleau Las Vegas Goes Chapter 11
More trouble on the Las Vegas Strip. The Fontainebleau Las Vegas, a $3 billion resort under construction on the Strip has filed for bankruptcy-court protection. The resort has sued a group of lenders who reportedly backed out of an $800 million loan that was necessary to complete the project. Fontainebleau Las Vegas has said that is is filing a $3 billion lawsuit against its lenders for breaking their commitment to the project.
In related news, Crown Ltd., Australia's largest casino owner wrote down the value of its 19.6 percent equity stake in Fontainebleau Resorts LLC to zero. The carrying value of $22 million of debt in Fontainebleau is also expected to be written down to nothing and Crown doesn't plan to contribute anything else to the project.
The resort owners have said that they are still pursuing alternate financing to finish the project. For now though, construction has slowed to a crawl. The Fontainebleau would offer nearly 4,000 rooms in the area where the El Rancho and Algiers casinos were once located. it includes a casino, spa, performing arts theater, condo-hotel units, retail space, conference space and nightclubs, lounges, restaurants and even a chocolate factory. It was expected to open later this year. An animated rendering of the project is after the jump.