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May. 18, 2009
Copyright © Las Vegas Review-Journal

Corporate layoffs begin at Fontainebleau, more cuts likely

By ARNOLD KNIGHTLY
LAS VEGAS REVIEW-JOURNAL

The Fontainebleau Las Vegas' dispute with banks has led to layoffs at the corporate level that began Monday, a spokesman for the project said.

The developer of the $3.1 billion project began laying off as much as 25 percent of its remaining skeletal work force Monday with more cuts likely this week, according to people familiar with the situation.

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    • While the exact number of the corporate layoffs is not known, people familiar with the project said between 160 and 175 people were employed before the layoffs began.

    “This is the inevitable conclusion once the banks pulled the funding,” said Dave Satterfield, spokesman for Fontainebleau.

    Fontainebleau’s attorneys filed a $3 million lawsuit April 23 after a group of banks led by Bank of America pulled $770 million in financing after saying the project had defaulted on a loan.

    Project officials insist no default has happened.

    An amended lawsuit filed last week accused Deutsche Bank, which controls $80 million of the $770 million disputed loan, of a conflict of interest because of the bank’s ownership of the $3.9 billion Cosmopolitan project a half-mile south on Las Vegas Boulevard.

    This week’s layoffs are the first at the corporate level since the dispute began. Construction on the 24-acre site, however, was slowed with the great majority of the 3,300 construction workers on the project laid off.

    Monday’s cuts came in information technology and sales and marketing, according to various sources.

    Contact reporter Arnold M. Knightly at aknightly@reviewjournal.com or 702-477-3893.

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    THE JOKER wrote on May 19, 2009 06:17 PM: Another great projoke by the folks at Turdberry.


    B wrote on May 19, 2009 04:06 PM: There is nothing funny about this at all. Families that are suffering from the halt of construction ARE NOT LAUGHING. The property needs to be completed, its 80% done, what do you want? An abandoned building instead of a complete one? Wow, that is a great idea! This city is growing, get used to the skyline.


    Franklin Bowles wrote on May 19, 2009 02:26 AM: This is hilarious. I got offered a job there but I knew a loser that was fired from MGM and another guy from some timeshare place that they hired. I thought if they are hiring these people they are in big trouble. I was right. Good thing I kept my current job :)


    me wrote on May 19, 2009 12:31 AM: I remember walking out of the Courthouse in January saying to the person next to me that the thing wouldn't open. Some dude behind me kept saying it would be open in October. I said again it wouldn't open on time but the eavesdropper insisted it would open in October. Welcome to another dead property Las Vegas.


    Patrick wrote on May 18, 2009 09:16 PM: That is three billion with nine zeros not three (3) million. RJ please correct your article.


    jiimii wrote on May 18, 2009 08:43 PM: Wow, those poor Turnbury peeps with those condos that had their views blocked by that parking garage, and now just pour a little battery acid into those wounds and this thing may NEVER be completed?! I'd be really pissed: first you block my view, and now by a building that will be void of the cars that you were gonna put in there. Ouch!! I know that views are NEVER guaranteed, next time never buy below the 15th floor, make it 20! How much are those parking garage view condo's going for these days?


    LVguy wrote on May 18, 2009 08:41 PM: There are a ton of positions that need to be filled before a casino can open it's doors. Management of each department needs to be hired way ahead of time, so that they can set up their teams and prepare training. Engineering needs to have their guys in place so that they are familiar with the systems when they're turned over from the General Contractor to the Owner. Just two examples of hundreds of corporate positions that are filled before the doors open.


    anothermonstrosity wrote on May 18, 2009 08:35 PM: Another concrete and glass monstrosity sticking out of the desert floor like a bad dream. Bring back Wet n Wild I loved that mofo!


    Chris wrote on May 18, 2009 07:26 PM: It's good as dead, construction has been a virtual standstill for weeks now. It will probably be shut down soon.


    suckafree wrote on May 18, 2009 06:20 PM: how can they layoff workers when the casino isn't even open yet??? they should have been like steve wynn and paid for the building in full BEFORE opening it to the public. the construction is NOT even 100% complete yet. LOL!!!