Frank Sinatra’s Resort in Foreclosure

This post was written by jd on June 16, 2009
Posted Under: Real Estate

Cal-Neva Lodge & Casino

Cal-Neva Lodge & Casino

Having gone a few times to the Cal-Neva Resort, owned by Frank Sinatra for three years in the 1960’s, it’s sad to see the historic resort in foreclosure. Unique in that part of the resort is in Nevada and part in California, you could jump in their swimming pool which has the state line bisecting the pool in two. You could swim from California to Nevada in just a few strokes!

The resort was up for auction and the result—zero bids. The recession is taking a big bite out of tourism around Lake Tahoe. Indian gaming in California is keeping day trippers closer to home. And Ezri Namvar, the hotel’s most recent ex-owner, was forced into bankruptcy amid several dozen lawsuits, many from the tight-knit Iranian Jewish community in Los Angeles, which alleges that he ran a $500 million real estate fraud.

Marcil’s company, National Hospitality Holdings, specializes in turning around hotels in trouble. It was hired by Canyon Capital Realty Advisors, the Los Angeles company that foreclosed on the Cal Neva.

Canyon officials said their April 8 auction flopped because of the resort’s unique location: The border between California and Nevada splits the property. “It’s the only place,” Sinatra joked, “where you walk across the lobby — and get locked up for violating the Mann Act” (which bans interstate transportation of women for immoral purposes).

The odd division required simultaneous auctions in Reno, Nev., and in Roseville. The complicated process “masked” the resort’s real value, a Canyon spokesman said.

The resort was once a watering hole for elite seekers of quickie Nevada divorces.

Over the years, it was raided by Prohibition agents and shuttered by the IRS. Today, the property once known as the “Lady of the Lake” is showing her age.

In 1983, Ron Cloud, a Fresno, Calif., plumbing contractor who had acquired the Cal Neva, lost his license for allegedly rigging the slot machines and strong-arming debtors

Source Steve Chawkins Los Angeles Times

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