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“When the retail division of the project lost accessx to fundingthrough Lehman, it was unabl e to repay the resort for its shared of costs,” said Scotg Baena, of Bilzin Sumbergb Baena Price Axelrod, who representas Fontainebleau Las Vegas LLC in the bankruptcy. “That put enormoue stress on theresort entity, and that was the beginningv of the problems.” Fontainebleau Las Vegas LLC and two of its affiliatez filed bankruptcy petitions in Miami late The Fontainebleau Miami Beach is not included in the Soffer, also principal with Turnberrh construction and development companies, has personal guarantees on portions of the retaikl component of the Las Vegas project, but thosw portions are not in bankruptcy yet, Baena said.
The complex is 70 percen completed. Since December 2008, Lehman refusex to make any advances underthe project’sz $315 million construction loan, according to a motiomn to maintain cash management filed in the After Lehman’s refusals, money stopped flowingv through the retail entity to the resorgt entity. In March, other lenders pulled their and construction on the resort stoppeddin May, Baena said. The companhy said in a news releass that the decision to file Chapterr 11 was the result of litigationj with the other lenders on project abouftnearly $800 million in construction funding for the project. Other lenderss include , JPMorgan Chase Bank and Deutsche BankTrusrt Co.
Americas. In the short term, the company is seeking to stabilize and protect the finished portion of the Baena said. “It’s no longere possible to downsizethe building,” he said. “The 30 percenft remaining construction is principallythe interior. We’vs got a lovely building waiting tobe finished.”