Larry Ellison has deal in place to buy storied Crystal Bay property
December 17, 2017
Lady Luck appears to be shining on a multi million-dollar agreement for Cal Neva Resort & Casino in Crystal Bay, a couple of weeks after the sale appeared to be in jeopardy.
Oracle Corp. co-founder and billionaire Larry Ellison has reached a deal with creditors to allow a $35.8 million deal for the storied and financially troubled North Shore property to move ahead.
The Sacramento Bee initially reported the agreement on Dec. 12.
Cal Neva would be acquired through Ellison's Lawrence Investments, according to documents filed with the U.S. Bankruptcy Court in Reno. The acquisition needs to be completed by Jan. 10.
The agreement comes after weeks of negotiations with creditors. As a result, a Dallas-based creditor will get about $27 million of the proceeds from the sale, the Bee reported.
The creditor, who is owed millions of dollars by the former owner of Cal Neva, will also get to keep equipment and furniture from the resort and casino. The equipment and furniture are stored in a warehouse in Sparks, Nevada.
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Tourism and local officials, who have long waited for some good news about the property, embraced the development.
"I saw the reports that there was some hesitation or potential buyer's remorse, but it seems that has kind of reversed itself," said Andy Chapman, president and CEO of the Incline Village Crystal Bay Visitors Bureau.
"I don't have any insight into Mr. Ellison's thinking, but I'm certainly glad it's moving forward."
The agreement marks a stark turnaround from a couple of weeks ago when the sale appeared to be doomed, a bankruptcy court filing showed.
"The U.S. Trustee is informed and believes the stay of the proposed sale is for a longer period of time than the proposed buyer will accept," Assistant United States Trustee Nicholas Strozza wrote in the filing in late November.
But circumstances have changed for Cal Neva, which straddles the California and Nevada border.
The resort was purchased in spring 2013 by Criswell Radovan, a Napa Valley-based real estate firm. The resort was then shuttered in September 2013 for a highly anticipated, multimillion-dollar renovation.
That heyday included the memorable era in the 1960s when the resort was owned by Sinatra, and frequented by the likes of the Rat Pack, Marilyn Monroe and members of the Kennedy family.
However, a series of delays over the years pushed back the grand reopening of Cal Neva to the point where it never happened. Then, in June 2016, Criswell Radovan filed for bankruptcy.
According to legal documents obtained by the North Lake Tahoe Bonanza, Criswell Radovan owed more than $27 million to creditors affiliated with the project, including $7 million to lead contractor The Penta Building Group of Las Vegas.
Originally built in 1926, Cal Neva 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, and a lounge.