A plan to launch The Drew Las Vegas as the newest casino resort in southern Nevada has reportedly taken another hit following reports that due to a coronavirus-related decline in its finances, its owner has sold the under construction land.
Witkoff Group LLC invested approximately $600 million some 43 months ago to purchase the half-finished Las Vegas Strip development that was to be known as The Fontainebleau, according to a Thursday article by the Las Vegas Review-Journal newspaper. By the end of 2020, the New York City-based corporation reportedly had plans to complete construction in order to launch its new look, The Drew Las Vegas, complete with a 3,780-room hotel and a 95,000 sq ft casino.
Casualty of the pandemic
The newspaper, however, claimed that this timetable was later scuppered as the coronavirus pandemic destroyed the key economic engine of Las Vegas, tourism, and left the business scrambling around for someone to take their hands off the 24.5-acre property. The developer was reportedly known to have raised approximately $2 billion in external funding from the likes of a subsidiary of Hyundai Motor Group and South Korean casino operator Kangwon Land Incorporated to help it complete the grandiose undertaking, headed by American real estate mogul Steve Witkoff.
Even so, Witkoff Group LLC has since offloaded the proposed $2.5 billion project for an undisclosed sum to a consortium consisting of the real estate unit of American multinational Koch Industries Incorporated and Florida businessman Jeffrey Sofferer, the Las Vegas Review-Journal reported. Sofferer is allegedly in charge of Fontainebleau Development, based in Miami, which began the ill-fated Fontainebleau project back in 2005.
Jake Francis serves as Koch Real Estate Investments President and he allegedly announced that his company will now hold a 75 percent interest in the long-stalled Las Vegas project, but refused to provide specifics of what the 63-story property might hold in the future.
A statement by Francis read: “We believe strongly in the Las Vegas market and see the property as a great opportunity to contribute to the long-term success and positive trajectory of this vibrant and innovative region.”
For his part, Brett Mufson, President of Fontainebleau Development, reportedly told the Bloomberg news service that his company had originally hoped that his luxurious Fontainebleau Miami Beach property would serve as a sister venue for the $2.8 billion The Fontainebleau. However, he also reportedly refused to comment on what the new owners are now planning to do with the blue-tinted skyscraper or whether they would adhere to the initial plan to use the site to host a world-class casino resort.
Reportedly, Mufson told Bloomberg: “We’re currently evaluating all of our options and looking forward to being part of the advancement of the world-class Las Vegas entertainment industry.”