Alex Close/Tahoe World
CRYSTAL BAY, Nev. - After fielding more than 150 calls from potential investors concerning the Cal Neva Resort, Spa and Casino, owner Canyon Capital Realty Advisors has hired CB Richard Eliss' Global Gaming Group and Hotel Group to market and sell the property.
Canyon representatives said they have seen considerable interest from U.S. hospitality and gaming investors for the 13.6-acre, 219-room hotel and casino that straddles the California and Nevada state lines on Lake Tahoe's North Shore.
"We said from day one that we would keep Cal Neva open for business, make long overdue management improvements to the property and assess its future," Canyon executive Richard Bosworth said, according to a Canyon statement. "That's exactly what we've done. Cal Neva is a great asset with a very bright future, and we think the time is right to market the property to interested buyers."
The Los Angeles-based investment adviser and money management firm took control of the historic property in April after a bidder-free, two-state foreclosure auction.
Within 24 hours of the auction, Canyon placed a management team NHH Hotels and Resorts in charge of the property.
Since April the property's business operations has seen a significant turnaround, according to Canyon, including higher occupancy rates and event activity, including weddings and corporate meetings. Last month room reservations through Expedia.com increased 650 percent over the last year, Canyon reported.
"Canyon's successful efforts to stabilize Cal Neva in such a short period of time validate the company's vision of the property as well as the resort's upside potential," said CB Richard Ellis Executive Vice President John Knott, according to a press release.
CB Richard Ellis Group is the world's largest commercial real estate services firm in terms of 2008 revenue, according to its website, www.cbre.com/EN. Its Gaming Group and Hotel Group is headquartered in Las Vegas.
Last week the company reported a net loss of $6.64 million in the second quarter. In 2008 year the company's net income in the second quarter was $16.6 million.
Knott's team recently released an initial brochure to kick off the sale period of the Cal Neva. A full Investment Memorandum will be released soon, according to the press release.
"Cal Neva is a key asset in Lake Tahoe, a market with particularly high barriers to entry," Knott said. "This property presents investors the opportunity to brand and reposition an irreplaceable asset."
Originally built in 1926, Cal Neva was owned by Frank Sinatra in the early 1960s, and flourished as a popular destination for the Hollywood and political elite. The resort includes 219 rooms and cottages, restaurants, a spa and open space featuring panoramic views of Lake Tahoe. The property also features a 350-seat show room, 16,000 square feet of meeting space, a lounge and a 5,365 square foot casino. With the property's non-restricted gaming license, the new owner could more than double the size of existing casino, according to Canyon.
The gaming win at North Shore casinos came in at $1.7 million in April 2009, according to the Nevada Gaming Control Board. That 10.1 percent decrease is on top of a 38 percent decline in April 2008, which means North Shore casino win has been cut nearly in half over the past two years.