Two Way Hard Three | Las Vegas Casino & Design Blog

Posted by Paolomello

I like "Fontaine-phere".

There were bound to be a couple last minute speculators. It sounds like a done deal for Icahn. I really hope he doesn't mothball the whole site for a couple years.

Somewhat sad we'll never get to see the property as its original builders and designers intended us to see it. However, we survived a recession/depression, and shit happens. Oh well. :) Maybe they should have planned better.

One of the reader comments following the Sun article says some permits have already been issued. Don't know if this is true, but I don't think Icahn wants the hulk to sit there. This is a sad story about the younger Soffer who has helped destroy the empire his father built in South Florida.

There is no better time for Icahn to finish construction with the slow economy and loads of construction workers, engineers, etc searching for work.

One of Two things will happen;

1. Icahn weather proofs the property and sits on it for a few years, although i have heard that maintenance (chillers & Air handling units need run, and maintained) current cost is around $5m/month for "maintenance"

2. Icahn finishes the project to a point to get it open. The rooms are fully finished to the 20th floor (just no furnishings in them), so he could finsh items in the podium like the Casino, a few retsaurants, some meeting space, restrooms, etc and have a working property on the cheap, with scope for expansion in all the shelled spaces whenever he needs it

I would think at a minimum he needs to shore the place up somewhat and prevent further damage from its current state.

http://www.lasvegassun.com/news/2010/jan/16/will-big-wager-fontainebleau-pay/

Liz Benston tried reading the tea leaves a few days ago, and I'm having a better idea of what I think will happen to F-bleau. I say Icahn finishes it, but NOT as Soffer had intended. He spends less than the $1.5 billion that Penn was freaking out about, and F-bleau opens as a more mid-range/"budget" property.

"Billionaire corporate raider Carl Icahn said Wednesday he would wait for the Las Vegas gaming market to settle before deciding how to proceed with the bankrupt Fontainebleau development, which has been shuttered since April."

Fontainebleau may sit there for quite a while if Icahn takes this approach. It will take years for Vegas to absorb additional room supply and rebuild convention and independent tourist activity. I still believe he will move sooner than that.

http://www.lvrj.com/business/icahn-closer-to-fontainebleau-82236442.html

This is a pretty good outcome for F'bleu. Icahn has more ready access to capital than most, and has owned/operated a casino-hotel operation before -- something every investor thinks they can do but few really pull off.

In the LVRJ article, what I hear Carl saying is, no rush to open while room rates are so depressed. While a partial completion/opening may sound good at first blush, I suspect with the mammoth size of this thing, you probably incur 90 pct of the cost with only 75 pct of the revenue drivers and doesn't net enough to make the effort worthwhile

Also, they're now free to rebrand this thing and can ditch the hard to spell name that really has no connection to the place, architectural or otherwise. It really needs some compelling story if it's just going to be the MGM Grand of the north strip.

I'm I the only one that actually liked the concept of Fbleu? I remeber the sketchings were amazing, especially the pool area. Yes, I know it was more "modern" design like everyplace else, but I did like what I saw.

I don't think it would even be worth opening some sort of "dumbed down" resort at this point. Who wants to go see some half assed resort when you have places like Wynn and Aria down the street? There's not enough demand to support soemthing like this, when even Joe Schmo can afford to stay at Encore these days (ok, maybe not eat there). It's not like it offers a convenient location either. Maybe cosmo could get away with it, but not Fbleu.

Seal the place up and wait a few years to do it right.

Great story in LV Sun on Icahn and FB. Bill Lerner thinks it will be mothballed until 2015.
http://tinyurl.com/y9lf3oc

Carl Icahn has always been the stir up master. He is fighting with Donal Trump over the defunct Trump Casino. Will be interesting to see if he actually ends up being a majortiy owner of the Fbleu.