Larry Ellison has made billions in high technology and has a knack for buying glitzy real estate properties. Can the founder of Oracle Corp. bring his Midas touch to a faded Lake Tahoe resort once owned by Frank Sinatra?
Ellison’s Lawrence Investments has been cleared to buy the Cal Neva Resort & Casino for $35.8 million, according to U.S. Bankruptcy Court records. A federal bankruptcy judge approved the sale on Oct. 16 after no other bidder surfaced for the fabled property. The Cal Neva has gone through a succession of owners over the years and has been unable to regain its Sinatra-era luster. The resort, which straddles the California-Nevada border and includes a 10-story hotel tower and a small casino, has sat idle since 2013.
The Cal Neva represents another big splash for Ellison, who reportedly spent $500 million buying Hawaii’s Lanai island in 2012, owns a $42 million property in Rancho Mirage and a multimillion-dollar “garden villa” in Japan. The Wall Street Journal has referred to him as “one of the nation’s most voracious consumers of trophy real estate.” Forbes pegged his net worth at $43 billion.
Ellison is no stranger to Tahoe. He sold a mansion in the Snug Harbor area in 2014 for $20 million and is building an 18,000-square-foot getaway on the north shore.
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Ellison’s purchase has the Tahoe community buzzing – and mystified. It remains unclear whether the tech titan will carry out the renovations that were begun by a St. Helena developer, Criswell Radovan, which bought the Cal Neva and shut it down in 2013 to begin renovations. Criswell halted work on the $49 million facelift in early 2016 and placed the Cal Neva in Chapter 11 bankruptcy proceedings a few months later.
The lawyers who shepherded the purchase through bankruptcy court for Ellison weren’t immediately available for comment, and a person answering the phone at Lawrence Investments’ office in Walnut Creek said the firm wouldn’t comment. Area officials and community leaders said Monday they haven’t been contacted by Ellison or his representatives about plans for the Cal Neva.
“We haven’t heard anything from a new owner,” said Tom Lotshaw, spokesman for the Tahoe Regional Planning Agency, which regulates development around the lake. Lotshaw said the agency would be “happy and willing and able to work with them to keep a good project going.”
Court records show Ellison’s firm severed ties with Strategic Gaming Management, the firm that had been lined up to manage the casino at the Cal Neva when it reopened. Strategic Gaming’s regional operations director, Eric Dale, said his firm doesn’t know what Ellison has in store for the Cal Neva.
“They’ve been radio silent,” Dale said. “I sat through many a court date and I’m not exactly sure what the intention is for the property at this point.”
Andy Chapman of the Incline Village Crystal Bay Visitors Bureau said the community wants the Cal Neva to finish its facelift and reopen for business.
“It’s an important property for the north shore,” Chapman said.
Much of the renovation had been completed when work halted last year, including the guest rooms and restaurants, but “I’m sure there’s quite a bit of work that still has to be done,” he said.
The Cal Neva opened 91 years ago and had its heyday from 1960 to 1963, when Sinatra bought it and turned it into an unofficial playground for Dean Martin, Sammy Davis Jr. and others connected to Sinatra’s legendary Rat Pack. The party ended after an FBI agent casing the premises spotted Chicago mobster Sam Giancana. Sinatra lost his casino license and unloaded the property. The Cal Neva has struggled ever since.
Contributing to the property’s downfall has been Tahoe’s struggles as a tourism market since the legalization of full-fledged, Vegas-style Indian casinos in California in 2000. Tahoe has been trying to reinvent itself by stressing amenities other than gambling. A consultant’s report in 2015 says the north shore draws 3 million visitors a year, although that doesn’t include the Nevada side.