Two Way Hard Three | Las Vegas Casino & Design Blog

January 19, 2009

LV Sun: Fontainebleau Has The Cash To Keep Rising

Posted by Hunter

Funny to see this story today in the Sun about the financing at Fontainebleau:

Just the other day as I was walking outside Encore, I was thinking to myself that it didn't look like much glass had been added to the tower at FBleau since December. Well, photographic evidence proved otherwise - my mind was just playing tricks on me and the glass is indeed rising.

When I checked out the visitors center there a few weeks back, there was a lot of construction activity in the low-rise portions. It is telling though that so far I don't think they will even sell you a condo - perhaps a chance they want to keep their options open?

The visitors area includes a large model of the complex, which does look interesting, as well as a model room. The room itself was nicely appointed - you can see Schaeffer and THEHotel written all over its style. Not quite as big as I would have expected, but then again, neither are the rooms at ARIA.


Read archived comments (13 so far)
January 19, 2009 10:54 AM Posted by Andrew H

I just don't see how this will succeed seeing it's size, demos, and location. I know the MB folks are in on this project and the build nice hotels for little money, however they are in a no mans land for many years to come. If the economy doesn't make a sizable turn I think they are in trouble. Also from the pics Ive seen of the model it appears their strip front land is going to be wasted with convention space, is that correct?

I wish them all the luck but with Encore on line, CC and Cosmo coming on line before them it appears as if there will be a lot of supply of better rooms, with better locations. They are looking at a first/second quarter 2010 open correct?

January 19, 2009 10:59 AM Posted by Jeff in OKC

I'll say it again, Schaeffer & Co. should take a page from Wynn, and put the full court press on you and other new media moguls. I think more is known about Encore than any other new Casino that ever opened, which translates into more bodies wanting to visit, stay and spend.
Hunter, I'm sure you've tried to get Liz Benson to guest on the Vegas Gang, since she's a legendary hard worker in the business writing world. Do we need to offer to take up a collection to pay her appearance fee?

January 19, 2009 11:01 AM Posted by Hunter

We haven't had guests for awhile but I've been thinking about doing some more and she's on my list of potentials. I'd think that Jeff could probably put in a good word as a colleague.

January 19, 2009 11:37 AM Posted by Mike P.

This post and the Sun articles inspired me to click over to the Fontainebleau web site, which actually has some content now. They also have a pdf version of a glossy brochure available for download. Looks like it's aimed at meeting planners:

I actually like what I've seen of interior renders for F'bleau, but then I'm a sucker for sleek modernist design. Have to agree they're going to have a tough time succeeding up there. Unfortunately for them it's going to be a long time before the strip's center of gravity shifts north to any significant degree. Maybe proximity to the convention center will help though.

January 19, 2009 1:31 PM Posted by Jeff Simpson

Although location on the Strip has some significance, it really wouldn't be too long of a walk from Encore to Fontainebleau. I think location won't be much of a problem. If Fountainebleau does open in October it should beat Aria by a couple of months.

I would expect the property to have at least the same relative quality/pricing power compared with Encore and Aria as Mandalay Bay did compared with Bellagio. In other words, don't underestimate Glenn Schaeffer and his team. Glenn has a great sense of style and he's working with a bigger budget here than he did at Mandalay Resort Group. Although I believe Aria and the rest of CityCenter (especially Mandarin Oriental and the Crystals) will be a bigger hit than FB, I think the Fontainebleau will be a strong addition to the Strip.

January 19, 2009 1:47 PM Posted by David McKee

The indecision re condo sales would probably explain why Detroit got the runaround when he literally called F-bleau on it.

January 19, 2009 3:24 PM Posted by detroit1051

Liz' story was a pleasant surprise for me. It would be great for Turnberry, the North Strip and Las Vegas as a whole if FB succeeds. Certain issues have kept me from checking out the renovated/expanded Miami Beach FB yet, but it is getting a lot of good press, much of which I suspect is generated by the PR Dept. Regardless, Miami Beach needs good news as much as Las Vegas does in this recession. I believe Glenn Schaeffer's influence is a main reason for the Las Vegas type hype for FB Miami Beach.
When I read a review of the steakhouse there, I noted that the executive chef, Sean O'Connell, was at Bellagio. The restaurants and bars sound very Vegas-like.

January 19, 2009 3:32 PM Posted by Doug

When you think about location on the strip it's important to remember the Las Vegas Convention Center - I'm sure the FB people have thought about it a lot!

I'm looking forward to this hotel and if FB lands some top-notch entertainment (not just another trendy nightclub) they could do well. And if they are a 'hit' the Riviera might be on the market again very fast. (I've given up on Circus Circus ever changing in my lifetime).

January 19, 2009 3:42 PM Posted by detroit1051

Did you tech guys see the other story on FB?

January 19, 2009 5:08 PM Posted by Network in Vegas

With all the canceled and "delayed" projects lately, I'm just glad to see it still going up.

January 19, 2009 8:12 PM Posted by Tom M.

Let me be a little pessimistic here. I think its good business to properly finance these projects before you build them. But, regardless of whether they have the money or not, I think the economic model upon which the decision to build was made no longer exits. With Fountainebleau, City Center, and other resorts scheduled to open this year and early next year, there is WAY too much supply of upper end rooms to sustain some of these projects after they launch. I think Las Vegas is going into a deep and lengthy down period, and the upper end of the market is oversaturated already. I think when city center et al open, the occupancy rates for all of these hotels will drop significantly. So, they may be able to finish Fountainebleau, but will they be able to sustain the property through the tough times, especially since there will be very little condo sales to pay back some of the capital invested. I predict that many of these companies will have to go thru bankruptcy before this economy turn around.
As an aside, I thought it was interesting that in one interview, Steve Wynn talked about taking advantage of the down cycle in the construction business that will start in 2010 to begin development of the golf course land. Obviously, he is counting on getting better pricing for his projects in that time frame.

January 19, 2009 8:27 PM Posted by brent

I'm actually kind of intrigued with FB. Like others noted, I'm also sucker for sleek modernist design. The place seems to have a "beachy", Miami vibe to it. The pool area looks really well thought out.. I like how it apparently looks out over the strip. For better or worse I think it's really going to compete along the lines of Palms and Hard Rock. The problem is, the place just seems to big. You look at the stats for rooms, meeting space, retail, etc. and they are all quite large. I think there's at least 1000 too many rooms. the retail space seemed excessive too, but I suppose there's not alot in that area.

February 21, 2009 5:36 AM Posted by detroit1051

Bleak news for Fontainebleau.
"The Fontainebleau Las Vegas resort is expected to have trouble making interest payments once it opens for business this year because of the worsening economy and dim prospects for condo sales, bond rating agency Standard & Poor's said today."