Fontainebleau Resorts
Announces Vegas Plans
Entering an increasingly crowded field on the north end of the Las Vegas Strip, newly formed Fontainebleau Resorts today will announce plans for a new 4,000-room, $1.5 billion hotel and casino project and name as its first chief executive former Mandalay Resort Group president and chief financial officer Glenn Schaeffer.
Closely held Fontainebleau, based in Las Vegas, plans to build the resort on a 25-acre site and open by 2008. The project is in an area that has come to life recently with the opening of the new Wynn Las Vegas resort -- which opened last month but already is planning an expansion -- as well as a $1.6 billion project called Palazzo that is owned by Las Vegas Sands Corp.
Mr. Schaeffer, 51 years old, said in an interview that Fontainebleau is raising private capital but "intends to enter the public markets for equity in the not-too-distant future."
Fontainebleau Resorts owns the site and is closely allied with Turnberry Associates, a Florida-based real-estate concern with extensive condominium projects in Florida and Las Vegas. Jeffrey Soffer, chairman of Fontainebleau Resorts, is CEO of Turnberry.
Las Vegas in recent years has departed from the theme-based hotels that dominated the 1990s, and Mr. Schaeffer said the Fontainebleau will follow suit. "Architecture and design are the next frontier in Las Vegas from our point of view," Mr. Schaeffer said.
The luxury resort will draw heavily from the influences of architect Morris Lapidus, who in the early 1950s designed the original Fontainebleau Hotel in Miami Beach. The architect, who would go on to design more than 250 hotels world-wide was known for a postmodern style that was considered ahead of its time. His famous designs included the liberal use of curves and stairs and ceilings often placed in unusual positions or odd angles, among other innovations. Mr. Schaeffer said that he hopes to use Mr. Lapidus's influence and what he terms "Miami Swank" in the design of the Las Vegas project.
The resort company today also will announce it has completed the purchase of the original Miami Beach Fontainebleau Hotel, which has lost much of its luster in recent years. The hotel currently is owned by Stephen Muss, a Florida real-estate developer who bought it in the late 1970s. The company plans to immediately begin renovating the hotel and reopen it as a 1,750-room luxury property in 2007. Company officials say it is a bid to take the neglected and dormant Fontainebleau name and "instantly bring it up to luxury levels."
The Fontainebleau brand hopes to be "identified by its crisp aesthetics and an overall 'cool factor' that will resonate with traveling consumers," Mr. Schaeffer said. The company's planned resorts are "definitely for grown-ups," he said, noting that Fontainebleau hopes to attract guests who are in their mid-30s to mid-60s. Room rates also will reflect the desired demographic, with about 75% of the rooms expected to cost at least $300 per night.
Like other, newer properties on the Strip, the casino -- while still a certified moneymaker -- is expected to be de-emphasized in terms of the overall experience.
Fontainebleau and Turnberry also expect to build condominium projects in conjunction with the Miami and Las Vegas hotel projects.
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