By Alesandra Dubin Posted June 17, 2009, 2:18 PM EDT
LAS VEGAS Last week, the Fontainebleau and affiliates filed for Chapter 11 bankruptcy reorganization—leaving the fate of the $3 billion Fontainebleau Las Vegas, which stands on 24 acres and is more than half complete, in question. The Miami Herald reported that the Fontainebleau Las Vegas filed a motion before last Thursday's hearing, asking the court to declare that the banks breached their commitment to lend $800 million to the project, and that the Fontainebleau wants a court order for the banks to make $656 million available now to get construction under way again.
On Monday, the Las Vegas Business Press suggested there might be help on the way. The Strip property could receive bailout financing from the Washington, D.C.-based Union Labor Life Insurance Company, which has already committed close to $450 million in construction funding to the development. According to the Business Press, the Fontainebleau Resorts LLC investment group has had significant trouble securing backing to complete the new property. It sued lenders earlier this year for reneging on the pledged $800 million in financing.