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LAS VEGAS-Deutsche Bank AG said Tuesday it took a $653-million charge against earnings in the first quarter to reflect a bad bet in Las Vegas. The write-off reflects the declining value of Cosmopolitan Resort and Casino, its $4-billion resort project under construction on the Las Vegas Strip. The project went vertical in April 2007 and is now scheduled to open late next year, one year later than originally planned.

The German bank, initially only the lender on the project, began foreclosure proceedings in January 2008 after Cosmo Senior Borrower LLC, the Ian Bruce Eichner entity that was the original owner and developer of the property, defaulted on its $760-million construction loan that it could not refinance amid the credit crunch.

In September, Nevada Property One LLC, an affiliate of Deutsche Bank, bought the resort out of foreclosure for about $1.44 billion, inked a “guaranteed maximum price contract” with Perini Corp. to complete construction and tapped Related Cos. to oversee the work. Perini has been working on the project from the beginning. In January, the bank won a two-year extension of its waiver from standard parking requirements for the $3.9-billion development.

The development site is a small lot between the Bellagio and the under-construction CityCenter development, both of which are owned by MGM Mirage. The project includes two high-rise condo-hotel towers with approximately 2,000 condo-hotel units and 1,000 straight hotel rooms, 641,850 square feet of back-of-house area and 522,934 square feet of public areas above subterranean parking. Approximately 1,800 units are said to be under contract.

The parking standards waiver, a 32% reduction in the required parking from 5,029 spaces to 3,420 spaces, was approved in December 2005. The commercial subdivision was re-approved in October 2008, after Deutsche Bank bought the property out of foreclosure.

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