Fontainebleau Las Vegas Sold for $600 Million Clams

As we first shared on Aug. 21, 2017, it’s now been officially announced Fontainebleau Las Vegas has been sold for $600 million.

The abandoned project was sold by bajillionaire Carl Icahn to two real estate firms, Witkoff, a “global real estate development and investment firm,” and New Valley, an investment company.

A rep from Witkoff said the purchase marks his company’s foray into “the supply-constrained and fundamentally strong Las Vegas market,” which makes it sound so much more sexy than it really is.


Aw, man, this might be our last chance to use this photo. Oh, well.

In a news release, Steve Witkoff, Chairman and Chief Executive Officer of Witkoff, said, “2755 Las Vegas Boulevard South is one of the best physical assets in the country, which is one of the reasons we were attracted to it. Furthermore, the resort is ideally located on the Las Vegas Strip, directly across from the Las Vegas Convention Center, which is in the midst of a $1.4 billion expansion and renovation. At the basis, we acquired a well-designed, structurally sound integrated resort at a significant discount to both replacement cost and the implied public market valuations of comparable Las Vegas Strip resorts.”

Witkoff continued, “Las Vegas is one of the strongest lodging markets in the country given its highly favorable dynamics. RevPAR and EBITDA growth continue to accelerate and there has been no new supply since 2010.”

RevPAR is “revenue per available room,” and EBITDA is “earnings before interest, tax, depreciation and amortization,” a measure of a company’s operating performance.

During the economic downturn, Carl Icahn purchased Fontainebleau, pronounced “fountain blue,” for $150 million ($148 million, to be precise).

We are no math expert, but that means Icahn made $450 millionish on the deal. Or roughly double what he’s carrying in his pants pockets right now. (Realistically, though, there are costs associated with maintaining even an empty building, so his actual profit on the deal was less.)

Fontainebleau wrap

At the moment, Fontainebleau is less shimmer, more meh.

Specific plans for the former Fontainebleu Las Vegas haven’t been articulated yet, but it’s likely it will be rebranded and open as a hotel or (fingers crossed) shimmering “new” hotel-casino.

It’s been suggested this won’t happen for at least 2-3 years, so manage those expectations.

Deep thanks to our tipster who helped us break this story before the rest of the world.

We remain giddy about this news, and look forward to seeing what’s ahead for Fontainebleau, the tallest non-Stratosphere building in Las Vegas and a monument to WTF.

21 thoughts on “Fontainebleau Las Vegas Sold for $600 Million Clams

  1. Luis the Misanthrope

    Let’s see what they do with it. I’m more excited about the space at the very top of the building that sticks out and I would bet has amazing views of the strip. The lounges atop Mandalay Bay and Delano will get some more comepetiton when it comes to that sort of experience.

      1. Tommy Ursano

        Logically, it makes sense that The Strip will extend that direction and eventually be one sprawling megalopolis connecting to downtown.

  2. Photoncounter

    The new owners should seriously consider an open contest to rename the place. Free parking, 3:2 blackjack and free booze while gambling for life for the winner!

  3. JeffinOKC

    I’m guessing this is a great time to be Frank and Lorenzo Fertitta: Sell UFC for a billion, and then get deep pockets from New York to cover most of the Fountainebleau project. Win-win of the highest order, if I am right.
    Oh yeah, I think they were most of the promotion money behind “The Money Fight” last Saturday. They were able to use UFC people Connor McGregor and Dana White to build a half billion dollar event while being totally compliant with their UFC sale. If I am guessing correctly.

  4. Manybar Goatfish

    They should be able to finish it in two years, easy. The hard part is already done. And, besides, the longer they drag it out, the more likely it never gets built, again. Second verse, same as the first. It’s an interesting story to follow, either way. Good work, Vital Vegas!

  5. Tommy Vercetti

    There’s a fair share of optimism here,but reality is until the nort end of the Strip will become alive with attractions and services this place will sit dead for another 4 to 5 years at best. Even the Genting thing everyone is waiting for is taking forever,and everyone wants them to take the plunge first into sinking huge money in the deal. The truth is once you pass the Encore you’re in a no mand land that feels scary. Even when I used to drive from downtown and see the old Sahara in the distance my thoughst were ” wow,I’m almost there,I’m safe now”. Safe from what I really don’t know,but that tells a lot about what the general feeling is towards the area. And if you notice there’s not a single Steve Wynn-ized property on the north strip. Massive and ugly buldings, Fontainebleau inlcuded, that stand there out of the ground with the in your face casino doors. No grass,no palm trees,no lush surroundings,no Park MGM and the such. Who wants a Flamingo and Aladdin/PH like casino entrance anymore ? Absolutely ugly.
    Good luck to the new owners,obviously this is another Deutsche Bank – Cosmopolitan like deal. Open the place,pay it off and the sell it when it’ll start to make money. Of course the issue is WHEN.

    1. Manybar Goatfish

      Right on. I tried but can’t think of a single reason I will ever choose to or want to step foot in Fontainebleau. They need to do more than show up in a crappy part of town to get my credit card number. If I want to stay in a crappy part of town, I’ll stay home.

  6. Grid

    “there are costs associated with maintaining even an empty building, so his actual profit on the deal was less”

    Don’t forget he sold off the furnishings and such for a cool $5MIL. His carrying costs were reported to be $5MIL a year (Security, taxes, insurance, and maintenance ETC) but his write off for operating expenses and depreciation got him back $4.5 million in annual tax savings!

    So it cost him $500K net a year to keep the big chunk of shit. And when you figure in the $5MIL auction for the hotels contents, he had 10 years covered. So his profits were even more than what is being reported here.

    1. William Wingo

      Thanks, Grid. I was figuring $300 mil increase over seven years, less inflation, which didn’t sound like much in the rarefied atmosphere of high finance. But if your figures are correct, he did pretty well. I guess that’s why he’s Carl Icahn and I’m not.

      I still think the buyers have bought themselves the Devil’s own row to hoe, and it will be a while before we see any actual construction activity. But then, I’m not in any big hurry to revisit the Strip, North or South.

  7. Rooster

    Whatever it is the new owners are going to do, it can’t be worse than the “do nothing” plan Icahn had for it.

  8. Bouldersteve

    Great that it was sold but it would have been better is someone local with a history of casino ownership had bought it.Here is a suggestion..for the first year no resort fee and free parking.


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