I called Fontainebleau an epic failure in 2012. A quick refresher: it is an unfinished 68-story casino in Las Vegas on which $1.6 billion had been spent before the developer ran out of money in 2009. The bankruptcy court sold it to Carl Icahn for $150 million in 2010. He held on to it and sold it in 2017 for $600 million.
The new owners renamed it The Drew and initially planned to open it in 2020 and then pushed it back to the second quarter of 2022 and then November 2022. The new owners quickly sunk $490 million into it. In January 2020, Steve Witkoff was planning on closing on a $2 billion loan. The total expected investment to open it soared to $3.1 billion (including the $600 million purchase price).
Then the coronavirus recession happened. The construction loan fell through. The project was suspended indefinitely in March 2020. Now they have suspended making all payments on existing loans since May 2020. The project is not yet formally in default and the owners have asked for a deferment on the existing loan, but it is only a matter of time before it does into default and then bankruptcy court again. I think it is more likely to be demolished than to ever open.
Read: Plug Pulled on The Drew, Project in Default
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Update: The $490 million (600 billion won) was a loan from South Korean investors and payments on that have been suspended.
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