On CNBC Wynn Resorts CEO Steve Wynn discussed Carl Icahn’s declining asset, the Fontainebleau on the Las Vegas strip. The construction was halted a few years ago after 70% of the building was done. While Carl Icahn has been a success as an activist investor in stocks such as eBay and Pepsico, this deal looks to be a loser, at least according to Steve Wynn, who knows a thing or two about business in Las Vegas.
Wynn told CNBC, “Carl Icahn is sort of a character about stuff like that. I said, ‘What are you doing behind the Fontainebleau?’ He said, ‘I got a lot of cash, I just took a shot.’ He said, ‘You thought I was crazy when I bought the Stratosphere, and I made a billion dollars.’ I said, Carl, you made a billion dollars in ’04 and ’05 when things were easy. Fountainebleau is going to be a bit tougher.”
Icahn bought the hotel when it was in bankruptcy, but it looks unlikely to emerge; its furniture was recently sold to the European owner of Plaza. While the 68 story building is the second tallest in Las Vegas, it seems to be coming up short as an investment.