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Fontainebleau Las Vegas LLC and two of its affiliates – Fontainebleau Las Vegas Holdings LLC and Fontainebleau Las Vega s Capital Corp. – filed bankruptcy petitions in Miami late The Miami Beach hotel is not included in the The company said in a news release that the decision to file Chaptefr 11 was the direct result of litigationb with lenders on the Las Vegasa hotel construction project that had to do with contractual disputeas related tonearly $800 million in construction fundinhg for the $2.9 billion resort-casino project, whichy is 70 percent complete. Lenderx include , and Deutsche Bank Trust Co.
The legal dispute has effectively shut down the projectgand “put thousands of people out of work,” said Howarsd Karawan, chief restructuring officer of Fontainebleau Las in the release. “Our goal now is to secure funding to complet ethis world-class project and restructure our existint debt.” Fontainebleau Las Vegaes reached a provisional agreement with a group of its non-defaultinvg lenders for the use of cash for the administrationm of its bankruptcy case, and is in negotiationd to obtain financing to restart construction on that project.
Fontaineblea u Miami Beach, which is a separats legal entity, continues to operate as TurnberryWest Construction, the project’s general contractor, is also not includedf in the filing, according to the news In 2008, Nakheel Hotels of Dubai bought a 50 percentf interest in the Fontainebleau Miami Beach for $375 The Las Vegas hotel companies that filed bankruptcyu are based in South Florida becauss the Soffer family of Aventura, whichg also owns the Turnberry development and construction owns all the Fontainebleau companies. Jeffrey Soffer is a principalk of umbrella company FontainebleauResorte LLC, according to state records.
Fontainebleau Las Vegae also withdrew without prejudiceits $3 billio lawsuit in Las Vegas against some of its and refiled the case in Miami bankruptcyh court, where the Chapter 11 petitions were filed. The lawsuit with lenders was amendexd on May 12 to include allegations that Deutsche BankTrustg Co. Americas was “seeking to destroy the Fontainebleau in order tominimize competition” with the nearbu and Casino, which is wholl y owned by a Deutschw Bank subsidiary. "This claim is an attemp by the Fontainebleau's developers to distract from the fact that they have breache d theirloan covenants.
We will defends ourselves vigorously against thismeritlessw allegation," Deutsche Bank spokesman John Gallaghed said in an e-mailed response. Fontainebleaju Las Vegas LLC lists morethan $1 billion in debt and a similard amount in assets on its petition, with more than 1,00 creditors. The only South Florida creditor lister was International Bedding inFort Lauderdale, with a claim of $498,737.
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