The future of the Waldorf Astoria Tahoe project appears to be in question after its developer, EKN Development, defaulted on its $82 million loan for the second time in a year.
Leah Carter/TDT
CRYSTAL BAY — The future of the Waldorf Astoria Tahoe project appears to be in question after its developer, EKN Development, defaulted on its $82 million loan for the second time in a year.
The entrance to the historic Tahoe Biltmore Lodge and Casino is less than inviting, with profanities inscribed in graffiti on lobby walls and boarded up windows along its street facing side, a far cry from its former heyday. The second notice of default follows financial restructuring efforts across the course of the year, efforts which its CEO Ebbie Nakhjavani confirmed with the Tahoe Daily Tribune in January. However, Nakhjavani did not respond to requests for comment regarding the default.
The first notice of default was issued last April after failure to make a timely payment. The second notice, filed Feb. 28 by investor Lake Tahoe Partners LLC, cited EKN’s failure to repay the principal sum upon maturity. The first notice in April was rescinded following an agreement between EKN and the lender, before a posted notice of trustee sale in July.
EKN purchased the Tahoe Biltmore in 2021 for $56.8 million, with intentions to create the luxury Waldorf Astoria resort, which would potentially fit a shifting demand in the Crystal Bay area. The Tahoe Regional Planning Agency approved plans to begin the development in 2023, but the project has been consistently pushed back from original target dates in construction. Hilton is the parent company of Waldorf Astoria.
“Waldorf Astoria said we want fewer accommodations that are bigger,” said Jeff Cowen, the TRPA Public Information Officer, adding that the plans were initially put in place as the local tourism market is “changing and skewing heavily toward luxury.”
The Biltmore has a long history of hazy development attempts, financing issues and significant delays in plans. Boulder Bay LLC bought the structure for $28 million in 2007, with plans to turn it into a new casino resort with 366 rooms and condominiums. The permitting process was approved four years later by TRPA but the project was ultimately canceled due to financing issues.
Next steps for the project are still unclear, but its revised 2023 permit is still in effect. “There is a construction schedule the owners agreed to and our staff works with their project managers to see how things are progressing,” Cowen said in an email. “Some work on utilities and a new connector road at the top of the property happened last year. We have been told some demolition is scheduled to begin this summer.”
Crystal Bay which once saw many active casino-hotels plays host to other boarded up buildings which were once bustling with tourists. The fate of not just the Biltmore, but also many of its neighbors remains to be determined as demand continues to shift in the post-COVID years.