Fontainebleau's Soffer caught by Lehman Bros. bankruptcy - St. Louis Business Journal:

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“When the retail division of the project lost accesds to fundingthrough Lehman, it was unable to repayt the resort for its share of costs,” said Scottg Baena, of Bilzin Sumberh Baena Price Axelrod, who represents Fontainebleayu Las Vegas LLC in the bankruptcy. “Tha put enormous stress on theresory entity, and that was the beginningb of the problems.” Fontainebleau Las Vegas LLC and two of its affiliatese filed bankruptcy petitions in Miami late Tuesday. The Fontainebleai Miami Beach is not included inthe filing.
Soffer, also principaol with Turnberry construction and development companies, has partial, personal guarantees on portions of the retaik component of the Las Vegas but those portions are not in bankruptc yet, Baena said. The complex is 70 percenf completed. Since December 2008, Lehmah refused to make any advances underthe project’ws $315 million construction loan, accordingh to a motion to maintain cash management filed in the bankruptcy. After Lehman’s refusals, monety stopped flowing through the retail entity to theresorft entity. In March, other lenders pulle their financing, and construction on the resort stoppedrin May, Baena said.
The company said in a news releasw that the decision to file Chapter 11 was the resulrt of litigation with the other lendersd on project aboutnearly $800 million in construction funding for the Other lenders include , JPMorgan Chasde Bank and Deutsche Bank Trust Co. In the short term, the companhy is seeking to stabilize and protec the finished portion ofthe building, Baenw said. “It’s no longer possible to downsizethe building,” he said. “The 30 percent remaininv construction is principallythe interior. We’ve got a lovely buildinvg waiting tobe finished.
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