A long-delayed casino resort slated to appear on the Las Vegas Strip is set to finally complete construction work after securing a $2.2 billion loan from a group of banks and other investors.

Testament of Dedication

Fontainebleau Las Vegas, developed by a partnership between Fontainebleau Development and Koch Real Estate Investments (KREI), a subsidiary of Koch Industries, secured the financing with the participation of Sumitomo Mitsui Banking Corp., Blackstone, Goldman Sachs, Guggenheim Partners and VICI Properties.

JP Morgan Chase served as the administrative agent while Dustin Stolly and Jordan Roeschlaub of Newmark Group served as advisers for the financing. The property will be operated by a subsidiary of Fontainebleau Development upon completion.

Commenting on the development, Brett Mufson, president of Fontainebleau Development hailed the financing as “a milestone for Fontainebleau Las Vegas,” and as “a testament to the tremendous dedication” of the people who had worked to secure the funding at Fontainebleau and their counterparts at Koch Real Estate Investments.

Jacob Francis, president of Koch Real Estate Investments, thanked “J.P. Morgan, SMBC, Blackstone Real Estate Debt Strategies, Goldman Sachs, Guggenheim, and VICI Properties [in his comments] for recognizing both the potential of this property and the expertise of those involved in its capitalization, design, and construction.”

“Securing $2.2 billion in financing in today’s market speaks to the widespread confidence in this project and the team that’s come together to bring it to Las Vegas,” Francis concluded.

Twists and Turns

The property is located on the north end of the Strip, near Wynn Resorts and the Las Vegas Convention Center in a part of the Strip that has traditionally been a difficult one for hotel operators due to the lack of many other resorts nearby. In June 2021, Genting Group opened its Resort World Las Vegas in the area.

The partnership acquired the property in February 2021 and officially began work on the $3.7 billion casino resort project in November last year, planning to open the property to the public in 2023. The property is planned to have a 67-story hotel, a casino and convention space, as well as a two-level mall featuring more than 35 designer stores.

Originally launched by the owner of Fontainebleau resort in Miami Beach, Florida, Jeffrey Sofer, the project began in 2007 but was halted during the financial crisis as he lost control of it.

The property was owned by Carl Icahn and Steven Witkoff before Sofer and its partner, Koch Real Estate Investments, regained the ownership last year.