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LAS VEGAS-Fontainebleau Resorts LLC has closed on more than $4 billion of financing from a consortium led by Bank of America, Merrill Lynch, Deutsche Bank and Barclays. The locally based developer says financing will fully fund development of Fontainebleau Las Vegas, the expansion and renovation of Fontainebleau Miami Beach, and the repayment of existing debt.
As part of the financing arrangement, Fontainebleau raised $565 million in private placements of common and preferred equity. That total includes $250 million it obtained in April from Australia-based Publishing & Broadcasting Limited in exchange for the 19.6% interest in the company.
Construction began earlier this year for Fontainebleau Las Vegas, a $2.9-billion, 25-acre development across from Circus Circus Hotel-Casino on the Strip. Fontainebleau will be anchored by a 63-story, 3,889-room hotel, condotel and casino. Project amenities include a 60,000-sf spa, a 3,200-seat performance theater, an oversized rooftop pool and lounge and an undisclosed amount of retail.
In Miami Beach, a revamped and expanded Fontainebleau is expected to open in the summer of 2008. Set on 16 acres of oceanfront, the expanded resort will have 1,500 luxury guest rooms and suites, a 40,000-sf European-style spa, multiple restaurants, a Las Vegas-style nightclub, lounge and poolscape and 150,000 sf of meeting and convention space.
Fontainebleau Resorts is led by its majority owner Jeffrey Soffer, who also heads the Turnberry group of companies, owner of the Turnberry Place, Signature at MGM Grand and Town Square developments in Las Vegas, the Aventura Mall and Turnberry Isle Resort & Club in South Florida, and the Residences at Atlantis on Paradise Island, Bahamas.
Fontainebleau's executive chairman Glenn Schaeffer was formerly the president of Mandalay Resort Group. Soffer and Schaeffer co-founded Fontainebleau after Mandalay was sold in early 2005 to MGM Mirage.
In addition to Bank of America, Merrill Lynch, Deutsche Bank and Barclays, participating lenders participating in the $4-billion financing include Lehman Brothers, JP Morgan Chase, Bank of Scotland, Royal Bank of Scotland and Sumitomo Mitsui Banking Corp.
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