TAKING A GAMBLE ON STORIED RESORT
Billionaire Larry Ellison snaps up Sinatra’s famed border casino
REDWOOD CITY » Frank Sinatra’s famed Cal Neva Lodge & Casino on Lake Tahoe’s north shore once served as a playground for the rich and famous — even the infamous — and now it’s fallen into the hands of a billionaire Silicon Valley tech mogul.
Oracle co-founder Larry Ellison has gained bankruptcy court approval to buy the famed resort for $35.8 million, public records show. But can he restore the property’s former glory and top-notch guest list? Others have tried, without success.
Guests during the Cal Neva’s heyday included former President John F. Kennedy; actresses Marilyn Monroe, Judy Garland and Lucille Ball; Sinatra’s Rat Pack pals Dean Martin and Sammy Davis, Jr.; actor Cary Grant; and baseball legend Joe DiMaggio.
On the more notorious end of the spectrum: Famed crime boss Sam Giancana, a rumored silent partner of Sinatra, visited the resort frequently, prompting authorities at one point to pull the
casino’s license.
The Cal Neva’s new owner is no stranger to investing in resort property and hotels. In 2012, Ellison paid $300 million for about 98 percent of the Hawaiian island of Lanai. In 2015, an Ellison-controlled group, PA Hotel Holdings, paid $71.6 million for the 86-room Epiphany Hotel in downtown Palo Alto.
And now, Ellison-controlled Lawrence Investments has received approval from the U.S. Bankruptcy Court in Nevada to buy the Cal Neva, which straddles the California-Nevada state lines.
The Cal Neva tumbled into bankruptcy in July 2016 after a dispute between entrepreneurs, operating as Criswell Radovan, and their principal lender over a $49 million overhaul of the complex, court records show.
Originally built in 1926, the resort burned down in 1937 and was later rebuilt. The bankruptcy filing describes the property in colorful terms.
“The original Cal Neva Lodge & Casino is one of the most historically rich and beautiful properties located anywhere in the State of Nevada,” court documents state. “The property was originally constructed in 1926, and is nestled in the
tall Ponderosa Pine trees on Lake Tahoe’s crystal-clear north shore. In 1960, Nevada legend Frank Sinatra purchased the property and turned it into a top-notch gaming destination for the rich and famous.”
In recent decades, the rise of Indian casinos throughout California has chipped into demand for casinos in Nevada.
The Nevada resorts have revamped themselves as tourist attractions and vacation destinations, with gambling a less crucial element of their cash flow.
The Cal Neva Lodge struggled because it couldn’t adapt rapidly enough. Criswell Radovan, a realty firm based in St. Helena, bought the property in 2013, closing it for a far-reaching makeover. The casino hasn’t reopened since.
The developers had intended, as part of a complete makeover, to construct a new resort that would hark back to the old casino’s glory days, using a $29 million loan from Hall Structured Finance.
The project would have
included a 10-story hotel tower and small casino. But ultimately, the Criswell Radovan group defaulted on $7.5 million in financing and the lender refused to provide another $10 million in funding.
“The Cal Neva Lodge and Casino has changed hands many times and has seen many hard times since those golden days when it was the desired gaming resort of so many celebrities,” court documents state.