LAS VEGAS — A partnership between Witkoff and New Valley LLC has purchased the former Fountainbleau resort on the Las Vegas Strip for $600 million. The property is located at 2755 Las Vegas Blvd. S.
The 63-story resort never fully saw the light of day after construction ceased on the $2.9 billion, 3,900-room property in 2009 in the midst of the Great Recession. It was purchased by Carl Icahn’s firm, Icahn NV Gaming Acquisition LLC, in 2010 for $150 million when the asset was in bankruptcy.
The property is situated across from Circus Circus, near Encore and SLS Las Vegas. It sits in front of the Westgate Las Vegas, as well as the Las Vegas Convention Center, which is in the midst of a $1.4 billion expansion and renovation.
The asset was acquired at a substantial discount to replacement cost, according to Witkoff. The company spent four months conducting due diligence on the resort and Las Vegas market prior to the acquisition.
“Las Vegas is one of the strongest lodging markets in the country given its highly favorable dynamics,” says Steve Witkoff, Chairman and CEO of Witkoff. “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. 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.”
New Valley LLC is an investment company owned by Vector Group. New York-based Witkoff is a privately held global real estate development and investment firm that seeks undervalued assets in high-barrier-to-entry growth markets.
— Nellie Day