Las Vegas Sun

October 15, 2018

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Jeff Simpson on why a new resort positioned in the space formerly occupied by the Thunderbird should make money this time

It was another big news week on the Las Vegas Strip, and the biggest story involved a company with grand plans to build on a site with a checkered past.

Fontainebleau Resorts announced it had lined up more than $4 billion in financing, most of which will be used to build the $2.9 billion Fontaine-bleau Las Vegas.

The new resort is being built just north of the Riviera on a site that was originally occupied by the Thunderbird, which opened in 1948. The Nevada Tax Commission revoked the Thunderbird's gaming license in 1955 because of organized crime links to one of its owners. Although a lengthy court battle resulted in the Thunderbird regaining its license, the property never fully recovered from the battle.

The resort was renamed the Silverbird in 1977 and renamed again in 1982, becoming the Strip's second El Rancho. The casino closed in 1992 and was imploded in October 2000.

Turnberry Associates, the Florida-based developer of the Turnberry Place condominium towers just east of the future Fontainebleau, bought the property in May 2000 for what now seems like a dirt cheap $45 million. Turnberry principal Jeffrey Soffer told me then he expected to open a hotel on the site with an established casino operator.

Soffer said he hoped to make a decision on what they would use the site for and who would operate a possible casino within six months.

Although Soffer's decision took about 10 times as long as he had hoped, I think he made a good one.

He partnered with former Mandalay Resort Group President Glenn Schaeffer to form Fontainebleau Resorts in 2005, with Soffer serving as chairman and Schaeffer as chief executive.

The company bought the classic Fontainebleau on Miami Beach and began formulating plans to transform the old Thunderbird site.

I talked to Schaeffer on Friday afternoon about the company's plans, and it didn't take him long to convince me of their viability.

Never at a loss for a colorful way to express himself, Schaeffer, an alumnus of the Iowa Writers' Workshop, said the project will be the zenith of the evolutionary process on the Strip.

"We're going to compete on five distinct elements: Design, art, music, fashion, technology. The aesthetic is a contemporary, crisp look, with a 63-story, international-style glass skyscraper that would fit in the leading cities of the world," Schaeffer said.

Water and light will give the property a sensuous appeal, and generous use of art will contribute to the creation of what Schaeffer called "immersive environments" that will capture guests' fancy. "To the untutored, it will look cool, and to the tutored, it will reveal layers of narrative," he said, sounding like a writer.

The hotel tower will have a 3,500-seat entertainment venue and a zone of clubs and ultralounges.

Schaeffer downplayed the importance of the casino to the project's success, predicting gaming will contribute less than one-third of the property's cash flow.

I'm eager to see what Schaeffer can do with a robust budget. He managed to do wonders on a tight budget at Mandalay Resort Group, and it's clear he's itching to show the world that he can create a captivating resort. "We know the idea has tremendous resonance," Schaeffer said. "It's up to us to execute the dream."

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