Fontainebleau has finally been sold!
Carl Icahn sold the unfinished casino-resort to a group of companies led by Steve Witkoff, operator of a global real estate development and investment firm, for $600 million. The new owners include Vector Group Chairman Bennett LeBow and Chief Executive Howard Lorber, who also heads Douglas Elliman and New Valley, the investment firm owned by the Vector Group. You might be familiar with Douglas Elliman from Fredrik Eklund’s role in Million Dollar Listing New York.
Carl Icahn purchased the nearly complete Fontainebleau while in bankruptcy in 2010 for $148. Construction on the mega luxury casino-resort started in 2007 but stopped in 2009 when the owners ran out of money and filed for bankruptcy thanks to the most recent great recession. The massive 68-floor blue glass building was built on the land that was once home to the Thunderbird Hotel and Casino. For reference to the Vegas Strip today, Fontainebleau is near Circus Circus, SLS Las Vegas, and the Las Vegas Convention Center.
Construction of Fontainebleau was so close to being complete that the rooms were already furnished. After realizing that the market wasn’t ready for a new condo-hotel, Icahn started selling off the furnishings and put the project on hold. In 2011, the Plaza in downtown Las Vegas decided to renovate their hotel rooms using goods purchased from the Fontainebleau.
Over the years, Fontainebleau started to show age and has been known as the “big blue eyesore” on the Vegas Strip thanks to its size and blue glass windows aging. Witkoff has plans for the property but isn’t revealing too much. He told the New York Post that they plan on finishing construction of the construction. In 2016, it was estimated that it would cost $1 billion to complete construction.
Things Are Changing With The Big Blue Eyesore
In a press release, Witkoff says the property will no longer be called Fontainebleau. The new owners are referring to the property as 2755 Las Vegas Boulevard South. The company that ends up operating the property (more on that shortly) will probably give it an official name.
When originally planned, Fontainebleau was to open as a property of condominiums and hotel rooms. The developer will finish the building as a casino-resort with nearly 4,000 hotel rooms. There are no plans to sell condos according to the NY Post.
The original plans for Fontainebleau were actually quite inspiring. Plans detailed on Vegas Today And Tomorrow called for the following amenities on a relatively small 24-acre footprint:
– 100,000 sq ft casino
– Nearly 30 restaurants and bars
– 7-acre pool complex that includes 5 pools, 3 spas, 3 restaurants, a nightclub and ultra lounge, cabanas, and an open-air casino
– 3,200-seat performing arts theater
– 2,871 hotel rooms and 1,018 condos
– 300,000 sq ft of retail space
– 400,000 sq ft of conference space
– multiple nightclubs
– 60,000 sq ft spa
Here’s a three-minute promo reel with renderings of the original plans for Fontainebleau.
What Does The Future Hold For The Property Formerly Known As Fontainebleau?
This is the great unknown and we probably won’t know full details for awhile. What we do know is that name of the property will have a new name eventually. Additionally, the new owners will finish construction of the building. There are no plans to destroy the structure.
If the estimate to finish construction is still $1 billion than Witkoff will be into the project for about $1.6 billion. When originally planned, Fontainebleau was a nearly $3 billion casino-resort-condo complex according to Forbes. That estimate doesn’t seem far fetched after looking at the amenities detailed above.
Witkoff is a developer, real estate agency, and investor. They aren’t a casino operator but do have almost 10 hotels and mixed use properties in their portfolio. It appears as though the new owners might want to finish construction and sell the property in a couple of years to a casino operator.
Vital Vegas recently tweeted that there are rumors that the new owners of SLS Las Vegas could rebrand the property. Part of the rebranding of SLS Las Vegas could mean that they will shed W Las Vegas, SLS, and their partnership with Starwood. Coincidentally, one of the hotels in Witkoff’s portfolio is the Long Island Marriott. You may remember that Marriott purchased Starwood (owners of W Hotels) in 2016. Perhaps there’s a brand match here.
Maybe the rumored sale of the Cosmopolitan to MGM Resorts will actually happen and leave Marriott/Starwood without a property on the Vegas Strip. This is just piecing rumors together so it’s probably not going to happen…but hey ya never know. Look for more news to trickle out about the future of the property formerly known as Fontainebleau.