Fontainebleau Resorts Closes on $4+ Billion in Financing
Development of Fontainebleau Las Vegas, Expansive Renovation of Fontainebleau Miami Beach
JUNE 7, 2007. Fontainebleau Resorts, LLC today announced it has closed on more than $4 billion of financing that will fully fund its development of Fontainebleau Las Vegas, expansive renovation of Fontainebleau Miami Beach and repayment of existing debt.
As part of the financing, Fontainebleau raised $565 million in private placements of common and preferred equity, including the consummation of its agreement with Publishing & Broadcasting Limited (PBL) of Australia under which PBL invested $250 million in exchange for a 19.6% interest in the company. The debt financing was led by Bank of America, Merrill Lynch, Deutsche Bank and Barclays. Also participating were Lehman Brothers, JP Morgan Chase, Bank of Scotland, Royal Bank of Scotland and Sumitomo Mitsui Banking Corporation.
"We are pleased to have such prestigious financial partners behind us as we move forward with the development of Fontainebleau Las Vegas and the regeneration of Fontainebleau Miami Beach," said Jeffrey Soffer, Executive Chairman of Fontainebleau Resorts. "Their enthusiasm and commitment serve as strong endorsements of our ability to execute the Fontainebleau vision."
"With this outstanding financial sponsorship, we will establish our brand with landmark resorts in two of America's top entertainment cities," added Fontainebleau Resorts CEO and President Glenn Schaeffer. "Our future growth path will be decidedly international as we deliver Fontainebleau's poetic style and sensuous appeal to other destination markets, with the lights turned up full."
In February 2007 the company began construction of Fontainebleau Las Vegas, a spectacular $2.9 billion, 63-story, 3,889-room resort, condo-hotel, casino and entertainment destination on the Las Vegas Strip, anticipated to open in fall 2009. Fontainebleau Las Vegas will feature dramatically high ceilings, signature restaurants, 60,000-square-foot spa, 3,200-seat performing arts theater, trendsetting retail, state-of-the-art meeting space and the world's largest rooftop pool and club scene with incredible views directly down the Las Vegas Strip. The project encompasses 25 acres and features two dynamic entrance lobbies, one for drive-in guests off the Strip and one conveniently situated at Paradise Road near Las Vegas Convention Center.
The forerunner of a new generation of world-class resorts, Fontainebleau Las Vegas will bring the Fontainebleau brand to Las Vegas in dramatic fashion. Embodying a spirit of classic elegance meets cool ... with a touch of Zen, it will offer an aesthetic environment of light, reflection and space. Fontainebleau Las Vegas takes its cue from Morris Lapidus, the innovative architect who designed the curvilinear Fontainebleau in Miami Beach more than a half-century ago.
"It is destined to become the most celebrated building in the world," Schaeffer said. "Its brand-making attributes will be contemporary art, striking design and modernist spaces, fashion, music and technology all interwoven into an immersive, aesthetic experience."
In Miami Beach, a revamped and enlarged Fontainebleau is expected to open in the summer of 2008. On 16 acres of oceanfront, the new resort will include more than 1,500 luxury guest rooms and suites, a 40,000-square-foot European- style spa, multiple marquee restaurants, a Las Vegas-style nightclub, ultra- lounge and lush poolscape and 150,000 square feet of meeting and convention space. "One of the world's most recognizable resorts will once again become the ultimate seaside destination," noted Soffer.
Fontainebleau Resorts is led by its majority owner Jeffrey Soffer, who also heads the Turnberry group of companies, one of the country's leading real estate development firms. It is credited with the creation of more than $7 billion in commercial and residential property, including the Aventura Mall and Turnberry Isle Resort & Club in South Florida, Turnberry Place, Signature at MGM Grand and Town Square in Las Vegas, and The Residences at Atlantis on Paradise Island, Bahamas. Turnberry pioneered the category of high-rise luxury residential condominiums and condo-hotels on the Las Vegas Strip and will market approximately 1,000 condo-hotel units as part of Fontainebleau Las Vegas.
Glenn Schaeffer is recognized for concepts that have shaped Las Vegas over the past 25 years, particularly during his former tenure as president of Mandalay Resort Group and its development of Mandalay Mile. After Mandalay was sold in early 2005 to MGM MIRAGE, Soffer and Schaeffer co-founded Fontainebleau Resorts. The new company has also brought together a team of development and operational executives with long backgrounds in the industry, many of them instrumental to the success of other name-brand entertainment resorts. "This is a monumental start-up venture," Schaeffer acknowledged. "It requires as much know-how as imagination."