|By Dale Kasler, The Sacramento Bee,
Calif.McClatchy-Tribune Regional News
February 20, 2009 - One of Lake Tahoe's most storied casinos has gone into receivership, the apparent victim of Northern California Indian gambling, the recession and other problems.
The Cal Neva Resort, Spa and Casino, once owned by Frank Sinatra, defaulted on a $25 million loan, according to Washoe County records.
The resort, located along the state line on Tahoe's north shore, got hit with a "double whammy," said analyst Richard Wells of Wells Gaming Research in Reno.
Tribal casinos, including those near Sacramento, have been draining business from Northern Nevada casinos for several years.
"It's probably a combination of Indian gaming and the economy," Wells said. "This current recession has been pretty significant and has affected most casinos."
Mark Dzarnoski, the attorney for the lender, Canpartners Realty, said the resort's problems go far beyond those industry trends. He said Cal Neva's revenue fell 37 percent last year.
By contrast, all north shore casinos suffered a gambling revenue decline of just 19 percent, according to state officials.
Canpartners took control of the property from its owner, Arizona-based Namcal LLC, and is seeking to hold a foreclosure sale, Dzarnoski said. The lender was "very concerned with the financial capability of Namcal to keep that casino open," he said.
The lender is paying some of the resort's ongoing expenses to keep it open until it can get it sold in the spring, he said.
In the early 1960s the Cal Neva was owned by Sinatra, who lured celebrities like Peter Lawford and Dean Martin to the hotel. Sinatra lost his gambling license after mobster Sam Giancana was spotted there.
Contact The Bee's Dale Kasler at (916) 321-1066. Read his blog on the economy, Home Front, at www.sacbee.com/blogs.
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