The former Fontainebleau has a new operator: its outdated developer.
The actual estate wing of conglomerate Koch Industries teamed with Florida developer Jeffrey Soffer to obtain the unfinished Drew Las Vegas property on the Strip, according to a news release Thursday.
Terms were not disclosed.
Soffer was component of the team that at first developed the 60-as well as-tale megaresort during the mid-2000s bubble, but the venture, a person of Las Vegas’ tallest structures, went bankrupt in 2009 after the financial system tanked.
The blue-tinted skyscraper has changed hands a couple of periods considering the fact that but has by no means been concluded — a towering reminder of Las Vegas’ wild true estate trend and devastating crash and, for just about a yr now, the punishing spillover consequences of the coronavirus pandemic.
Developer Steve Witkoff, who experienced established out to full the vacation resort, shelved design immediately after the virus outbreak sparked sweeping shutdowns and other chaos, and the undertaking later faced liens and litigation.
“Talk about a saga from conception to completion for this property,” said Las Vegas authentic estate broker Michael Parks, a resort-casino professional with CBRE Group.
‘Finally get this open’
Parks, a former listing broker for the assets, reported he is thrilled for Soffer to be capable to “meet his first vision” for the vacation resort, incorporating the developer and his partners “can lastly get this open up and finish it.”
He stated he’s not mindful of any prior investments by Koch in Las Vegas, and thinks the offer shows that investors are counting on Las Vegas’ restoration from the pandemic, which has sparked big job losses and dealt a crushing blow to the region’s primary financial motor, tourism.
The new ownership — Koch Industries is led by billionaire political megadonor Charles Koch, and Soffer heads Fontainebleau Development — did not present any specifics Thursday on designs for the web page.
“We consider strongly in the Las Vegas market place and see the assets as a fantastic prospect to contribute to the prolonged-term achievement and optimistic trajectory of this lively and impressive region,” Jake Francis, president of Koch Actual Estate Investments, stated in a news launch.
Fontainebleau Improvement President Brett Mufson, former head of acquisitions and cash markets for Witkoff’s namesake business, reported in a statement that administration is “currently assessing all of our alternatives and searching forward to currently being section of the improvement of the earth-course Las Vegas amusement field.”
By means of a general public relations firm, Witkoff’s company declined to comment on the acquisition.
Rocky historical past
Options for the Fontainebleau ended up unveiled in 2005. The project, led by Soffer and previous Las Vegas casino govt Glenn Schaeffer, was named after the 1950s-period Fontainebleau resort in Miami Beach front, which Soffer experienced agreed to purchase months before.
They broke ground in 2007 and predicted to open up the venture in 2009. But the real estate bubble before long burst, and, as the financial system spiraled, the developers sued several banking institutions in spring 2009, alleging the “unscrupulous” loan providers backed out of their motivation to finance building of the vacation resort.
Billionaire Carl Icahn acquired the mothballed undertaking in 2010 for about $150 million and, following leaving it largely untouched, bought it in 2017 for $600 million to Witkoff and Miami authentic estate firm New Valley, a subsidiary of cigarette maker the Vector Group.
Witkoff renamed it the Drew in honor of his late son Andrew, who died of an OxyContin overdose in 2011 at age 22. He told the Review-Journal early past 12 months that he was shut to acquiring a roughly $2 billion construction loan for the project and would usher in a burst of setting up activity afterward.
Then in March, as Las Vegas speedily shut down in excess of fears of the coronavirus outbreak, he shelved construction of the undertaking.
Contractors later submitted tens of thousands and thousands of dollars’ really worth of liens alleging unpaid payments for their get the job done at the Drew. Various ex-employees also sued Witkoff, alleging they had been laid off from the job amid the pandemic and weren’t paid out what their contracts termed for.