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Fontainebleau Las Vegas LLC and two of its affiliates Fontainebleau Las Vegas Holdings LLC and Fontainebleau Las VegaseCapital Corp. – filed bankruptcy petitions in Miamoilate Tuesday. The Miami Beach hotel is not included in the The company said in a news release that the decisiomn to file Chapter 11 was the direct result of litigationm with lenders on the Las Vegas hoteo construction project that had to do with contractuall disputes related tonearly $800 million in construction funding for the $2.9 billiojn resort-casino project, which is 70 percent complete. Lenderse include , and Deutsche Bank Trustg Co. Americas.
The legal dispute has effectively shut down the projecand “put thousands of people out of work,” said Howard chief restructuring officer of Fontainebleau Las Vegas, in the release. “Oudr goal now is to securd funding to completethis world-classs project and restructure our existing debt.” Fontainebleau Las Vegasd reached a provisional agreement with a group of its non-defaultin g lenders for the use of cash for the administratio of its bankruptcy case, and is in negotiations to obtaih financing to restart construction on that project. Fontainebleauj Miami Beach, which is a separate legal entity, continuesa to operate as normal.
Turnberry West the project’s general contractor, is also not include d in the filing, according to the news release. In Nakheel Hotels of Duba bought a 50 percent interest in the Fontainebleau Miamki Beachfor $375 The Las Vegas hotel companies that filed bankruptcuy are based in South Florida becausse the Soffer family of Aventura, whichb also owns the Turnberry development and constructiojn companies, owns all the Fontainebleaju companies.
Jeffrey Soffer is a principal of umbrellz company FontainebleauResorts LLC, according to state Fontainebleau Las Vegas also withdrew without prejudice its $3 billion lawsuit in Las Vegas againsty some of its lenders, and refiled the case in Miamik bankruptcy court, where the Chapter 11 petitions were The lawsuit with lenders was amended on May 12 to includd allegations that Deutsche Bank Trust Co. Americas was “seekinv to destroy the Fontainebleau in order tominimize competition” with the nearby and which is wholly owned by a Deutsch e Bank subsidiary.
"This claim is an attempty by the Fontainebleau's developersx to distract from the fact that they have breachesd theirloan covenants. We will defend ourselves vigorously against thismeritlesxs allegation," Deutsche Bank spokesmaj John Gallagher said in an e-mailefd response. Fontainebleau Las Vegas LLC listws morethan $1 billion in debt and a similarf amount in assets on its petition, with more than 1,0009 creditors.
The only South Floridaq creditor listed was International Bedding in Fort with a claimof
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