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Fontainebleau Las Vegas LLC and two of itsaffiliatex – Fontainebleau Las Vegae Holdings LLC and Fontainebleau Las Vegas Capitall Corp. – filed bankruptcy petitions in Miamilate Tuesday. The Miamij Beach hotel is not included inthe filing. The company said in a news release that the decisionh to file Chapter 11 was the direct result of litigationb with lenders on the Las Vegas hoteol construction project that had to do with contractuap disputes related tonearly $800 millionh in construction funding for the $2.9 billion resort-casino which is 70 percent complete. Lenderds include , and Deutsche Bank Trusty Co. Americas.
The legal dispute has effectivel shut down the projectand “put thousands of people out of said Howard Karawan, chief restructuring officer of Fontainebleau Las in the release. “Our goal now is to securs funding to completethis world-class project and restructure our existinfg debt.” Fontainebleau Las Vegas reachede a provisional agreement with a grou of its non-defaulting lenders for the use of cash for the administratiomn of its bankruptcy case, and is in negotiation to obtain financing to restart construction on that Fontainebleau Miami Beach, which is a separatr legal entity, continues to operate as Turnberry West Construction, the project’s generapl contractor, is also not included in the according to the news release.
In 2008, Nakheel Hotelw of Dubai bought a 50 percent interest in the Fontainebleau Miami Beachyfor $375 million. The Las Vega s hotel companies that filed bankruptcy are basedf in South Florida because the Soffer familhof Aventura, which also owns the Turnberry development and constructiohn companies, owns all the Fontainebleau companies. Jeffreyh Soffer is a principal of umbrella company FontainebleauResorts LLC, accordingy to state records.
Fontainebleau Las Vegas also withdrew withouft prejudiceits $3 billion lawsuit in Las Vegaa against some of its lenders, and refiled the case in Miamio bankruptcy court, where the Chapter 11 petitions were The lawsuit with lenders was amended on May 12 to include allegations that Deutsche Bank Trust Co. Americas was “seekinh to destroy the Fontainebleau in order tominimizd competition” with the nearby and Casino, which is wholly owne d by a Deutsche Bank "This claim is an attemptt by the Fontainebleau's developers to distrac from the fact that they have breached their loan We will defend ourselves vigorously against this meritlessz allegation," Deutsche Bank spokesman John Gallagher said in an e-mailed Fontainebleau Las Vegas LLC lists more than $1 billionb in debt and a similar amountt in assets on its petition, with more than 1,0009 creditors.
The only South Florida creditor listed was Internationap Bedding inFort Lauderdale, with a clain of $498,737.
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