|By Douglas Hanks, The Miami
HeraldMcClatchy-Tribune Regional News
February 12, 2010--Lehman Brothers wants South Florida developer Jeffrey Soffer to cover a $168 million loan he personally guaranteed for the failed Fontainebleau Las Vegas casino.
The federal suit filed Thursday sets up a long-awaited showdown between Soffer and creditors of the Vegas project, which was sold for pennies on the dollar in bankruptcy court last month. Soffer partially blamed the Vegas venture's downfall on Lehman, the lender whose collapse in 2008 helped spark the global financial crisis.
Now in receivership, Lehman is suing in bankruptcy court in New York to enforce the Soffer guarantee on the Vegas loan. Soffer accuses Lehman of voiding the guarantee by cutting off construction funding in the middle of 2009, before the project could be finished.
"We are surprised at Lehman's actions given its own behavior on this project. Lehman's bankruptcy and default on its obligation to fully fund the retail portion of the project forced us to have to seek outside funding at a time when the credit markets were frozen," Soffer said in a statement. "They breached the whole agreement," he added.
Corporate raider Carl Icahn paid $150 million for the 63-story Fontainebleau Vegas, an unfinished tower that Soffer and investors spent roughly $2 billion to build.
In court documents, Lehman said the original $315 million Vegas loan at the center of the suit has a balance of $168 million, which includes unpaid interest.
Lehman filed suit against Lehman and Fontainebleau Resorts, the parent company of the Fontainebleau Miami Beach and the Fontainebleau Vegas.
Soffer is a partner in Aventura's Turnberry Associates, which was founded by his father. He bought the Miami Beach resort in 2005.
The Miami Beach resort faces its own financial struggles, including more than $60 million in claims by contractors on the renovation and a $660 million overdue construction loan from Bank of America.
Though it was not a party to the Vegas Fontainebleau bankruptcy, the Miami Beach resort is the primary asset of Fontainebleau Resorts.
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