September 29, 2009

Creditors file to liquidate in Las Vegas

Creditors holding debt for the bankrupt Fontainebleau Las Vegas want developer Jeffery Soffer cut from the project, court papers show.

``With completion of the Project by the Debtors not possible, a sale of the Project to a third party and liquidation of the remaining assets is the only viable course,'' the lenders wrote in a court filing, The Miami Herald reported Tuesday.

Construction was halted this spring on the 3,889 room condo, hotel and casino. The project requires an estimated $1.5 billion to complete, the newspaper said.

The dealing sets up conflicting strategies in court. Lenders want the project sold, but say they won't put another dime into the project as is, given the problems with construction. Soffer's lawyers say they have a potential buyer, but need more time to close on a deal.

Creditors say its time to move to liquidation --Chapter 7 as opposed to Chapter 11.