Fontainebleau Casino Plans Halted After Call for Chapter 7

Plans to build a Las Vegas version of the famed Miami Fontainebleau Hotel are probably over after creditors demanded the holding companies convert from a Chapter 11 to a Chapter 7 bankruptcy.

In Miami, the Fontainebleau is one of the oldest and most loved oceanfront hotels in the city. Dating back to 1954, it has been featured in several movies, including “Goldfinger,” “Scarface” and “The Bodyguard.” The hotel boasts 11 restaurants, more than 1,500 rooms and a giant 40,000 square-foot spa.

In 2005, two real estate companies made a joint purchase of the hotel and created Fontainebleau Resorts, a company based in Las Vegas that sought to recreate the Miami magic in the desert.

However, last June Fontainebleau Las Vegas LLC and two of its affiliates filed for bankruptcy protection. They hoped to reorganize under a Chapter 11 after lenders pulled almost $800 million worth of construction loans. Without this money the corproation wouldn’t be able to finsih the project they started.

The Fontainebleau Las Vegas would have been a 3,889-room hotel, condo and casino near the Las Vegas strip costing almost $3 billion, the Triangle Business Journal in Florida reported. As of their bankrutpcy filing, the resort was 70 percent complete.

But three months after the company’s original bankruptcy filing, creditors have become upset and claim they have seen little movement by the hotel’s company. They are afraid that unless the hotel is forced to file chapter 7 bankruptcy and liquidate the assets that they won’t see any of their money.

The original Fontainebleau Hotel in Miami is not included in this filing.