The Fontainebleau Las Vegas project’s developers revealed on Friday that they have received a $2.2 billion loan which will help them finish constructing the 67-story entertainment and gaming destination. They intend to launch the venue next year.
The Fontainebleau Las Vegas is on the north side of the Las Vegas Strip. It is a 3,700-room resort that halted 12 years ago after its developers ran out of cash. The property has had two different owners since then and a bankruptcy sale.
Even so, its construction has resumed, and the developers are confident that they will finish it on time. Fontainebleau Development and Koch Real Estate Investments are the developers, and they secured the loan through Goldman Sachs, JP Morgan, Blackstone Real Estate Debt Strategies, SMBC, Real Estate Investment Trust (REIT) company VICI Properties, and Guggenheim.
Jordan Roeschlaub and Dustin Stolly from Newmark negotiated for the development partners. The loan comes several days after the U.S. Federal Reserve made the seventh-rate increase in 2022, which has discouraged many developers and killed their hope of securing construction loans.
Jacob Francis, Per Koch Real Estate’s President, stated that getting a $2.2 billion loan in the current market shows that many investors are confident in the Fontainebleau Las Vegas project and its partners. Koch and Fontainebleau are striving to complete the resort that features a casino, 3,000 hotel rooms, 550,000 square feet of meeting and convention space, dining, lifestyle, and retail attractions.
Still, the resort will have 150,000 square feet of gaming space, thus making it one of Las Vegas’ gaming destinations alongside Mandalay Bay, Bellagio, and Aria.
Soffer Purchases the Project
Jeffrey Soffer, Fontainebleau Development CEO and Chairman, was the project’s initial developer. Also, he is Donald Soffer’s son (a popular Miami realtor) who constructed an office building, condominium towers, and a huge mall in Miami-Dade County on 785 acres of land.
The 54 years old investor married Elle McPherson between 2013 and 2017. Forbes first added him to its top billionaire list in 2015. Soffer kicked off the project in 2017 and was declared bankrupt in 2009 when the project was 75 percent complete.
This occurred during the real estate crash and Great Depression. Carl Ichan, a billionaire, purchased the project in 2010 and later sold it to Steve Witkoff, a New York developer, in 2017.
Witkoff later planned to rename it Drew Las Vegas in memory of his late son. The construction project resumed in November 2021 when Soffer collaborated with Koch Real Estate Investments and repossessed the 25-acre venue in March 2022.
Soffer promised to finish the project as he has consistently worked on it for one year. Fontainebleau predicts that the project will end in Q4 2023.
More Details About Fontainebleau’s Development
Fontainebleau is active in Southern Florida after getting a $102.3 million development venue in August on Jupiter Island. The company revealed in October that it wants to construct a 50,000 square feet event site in Miami Beach.
It has a broad portfolio in the commercial, gaming, luxury, retail, residential, and hospitality service sectors. They include Fontainebleau Miami Beach, Big Easy Casino, JW Marriott Turnberry Resort & Spa, Turnberry Ocean Club, Hilton Downtown Nashville, Porto Vita, Turnberry Ocean Colony, the Sorrento, and Tresor Towers.
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