214 people can make Cosmo home

Some 200 potential residents could end up owning a condominium inside the $3.9 billion Cosmopolitan of Las Vegas, even though the development canceled sales activities more than two years ago and settled disputes with 88 percent of the project's buyers.

The condominiums haven't garnered much attention during this month's grand opening celebration for the 2,995-room Strip hotel-casino.

Sales, however, could close on a handful of the residential units shortly after Jan. 1, said a representative of German investment house Deutsche Bank.

"As we have consistently said, we are honoring the remaining condominium contracts and delivering units for closings starting in January," Cosmopolitan spokeswoman Amy Rossetti said in an e-mailed statement when asked about the halted residential component.

Deutsche Bank canceled the condominiums when the company took over the half-finished property for $1 billion after New York builder Bruce Eichner, The Cosmopolitan's original developer, defaulted.

Under Eichner, condominiums made up the bulk of The Cosmopolitan's units spread over two buildings.

When Deutsche Bank took over, 1,821 units were under contract. Buyers paid deposits of 20 percent to secure one of the planned high-six-figure to low-seven-figure condominiums.

After the project collapsed financially, The Cosmopolitan's sales office closed and sales halted.

During The Cosmopolitan's casino licensing hearing in October, Nevada gaming regulators were told 214 condominiums were still under contract with potential buyers. Jeff Baer, who oversees global logistics services for Deutsche Bank, said as long as buyers were able to meet their financial obligations, The Cosmopolitan "will deliver the units."

In April, Cosmopolitan developers completed a $60 million settlement with more than 400 buyers involved in a class action lawsuit. A spokesman for Deutsche Bank said buyers in The Cosmopolitan's west tower received 75 percent of their deposits. East tower buyers received refunds of 68 percent of their deposits.

Since that settlement was announced, 1,607 potential buyers took the offer.

Nevada gaming regulators were told the deal is now off the table.

Last spring, attorneys said they negotiated the best settlement they could in an economy in which high-rise residential sales along the Strip have shriveled.

A multitude of lawsuits from dissatisfied condo buyers have since been filed.

An attorney for Lurie & Park, a Los Angeles-based law firm handling a lawsuit against The Cosmopolitan, said condominium purchasers they represent have not received "accurate information" about the units from Deutsche Bank.

"These purchasers have not been invited to the opening of the property, nor can they get in to see their condominiums that they have put hundreds of thousands of dollars down as down payment," Sonia Taylor, an attorney for Lurie & Park, said in an e-mail.

She said about 100 purchasers plan to protest in front of The Cosmopolitan during tonight's opening celebration.

On Tuesday, Clark County District Judge Elizabeth Gonzalez granted an injunction that prevents The Cosmopolitan from renting any of the 214 condominiums still under contract until the potential owners have a chance to see those units, according to Lisa Lawrence, an attorney Lurie & Park.

The 214 condominiums still under contract are not included in the 2,000 units that will opened, a Cosmopolitan spokesman said.

About 2,200 of The Cosmopolitan's nearly 3,000 hotel rooms have outdoor terraces overlooking the Strip, including the 214 condominiums under contract.

When Deutsche Bank took over The Cosmopolitan, the planned condominiums were turned into hotel rooms with small kitchenettes. Other condominium amenities, including washer-dryer units, were removed. However, the condominiums still under contract have all the amenities originally offered.

During the summer, buyers with outstanding deposits received correspondence from The Cosmopolitan, telling them sales closings were expected to commence once the development opens.

In a newsletter dated July/August 2010, condominium buyers were told a number of key steps had been completed, including the creation of homeowner associations, the drafting of covenants, conditions and restrictions while arrangements are being made with First American Title Co. for closing procedures and documentation.

Potential condominium purchasers received letters from Cosmopolitan representatives saying that they would receive a series of communications, including updated project information, final condominium documents and other unit-specific information needed for closing.

"We have now reached a point in the process where we will no longer be able to make adjustments to the condo-hotel program, and need to begin making final preparations for unit closings," said a letter to a buyer.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.