FX Real Estate considering bankruptcy in light of receiver request

By Caroline Salls

Pittsburgh, June 11 - FX Real Estate and Entertainment Inc. said it is considering all of its options, including bankruptcy, since its first-lien lenders have requested appointment of a receiver for the company's Las Vegas property, according to an 8-K filed with the Securities and Exchange Commission.

The company said it is in default on its $475 million mortgage loan secured by the Las Vegas property, which makes up substantially all of its business.

According to the 8-K, the first-lien lenders sent a notice of breach and election to sell to FX on April 9, initiating the trustee sale procedure against the Las Vegas property to satisfy the $259 million principal amount and other obligations owed under the mortgage loan.

FX said it did not cure the default within a 35-day redemption period, which expired on May 18.

As a result, the Las Vegas property can be sold in a trustee sale to satisfy the first-lien lenders' obligations secured by the property. FX said the trustee sale process takes about 120 days.

The first-lien lenders filed a lawsuit on June 5 in the District Court for Clark County, Nev., and asked the court to appoint a receiver for the property.

If appointed, the company said a receiver would manage and operate the Las Vegas property until it is either sold at a foreclosure sale or FX files for bankruptcy.

FX Real Estate and Entertainment is based in New York and is focused on the development of real estate and entertainment-based projects and attractions.

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