Filed under: Real Estate Developments
It has sat at the end of the Las Vegas strip, big, blue and unfinished for a while but perhaps the Fontainebleau Las Vegas Resort will finally be completed now that casino-loving billionaire investor Carl Icahn has made the winning bid for the bankrupt resort. Tourism in Las Vegas has been sluggish recently and the Strip has a glut of new hotel rooms including those at the massive City Center project.
Reuters reports that court documents show that the only qualified bid received for the company was from Icahn Nevada Gaming Acquisition LLC. He had offered $156.5 million to buy the casino back in November, a bid which put Penn National Gaming Inc out of the running. Reuters interviewed Icahn who said his philosophy is to buy things when no one else wants them. It is a strategy that has served him well in the past. But Fountainebleau is a huge project, one that has already cost $2 billion and could cost another $1.5 billion to finish. It's got a nice Strip location but does Las Vegas need a 3,815-room resort right now? The Fontainebleau will also have a casino, spa, performing arts theater, condo-hotel units, retail space, conference space and nightclubs, lounges, restaurants and even a chocolate factory.
Icah was involved in a deal to buy the Tropicana's Atlantic City casino and we've been watching his machinations with Beal Bank to save the Trump Atlantic City casinos from ruin (and possibly from Trump himself). Icahn has played in Las Vegas before, buying low and selling high with the Stratosphere. In that case he bought the casino out of bankruptcy in 1998 and sold the property in 2007. If this proves anything it's that Icahn may be willing to wait a while to make a profit, a good thing because it will be a while before the Fontainebleau makes any money.