Imperial Palace owner Engelstad dies

By Liz Benston

Wednesday, Nov. 27, 2002 | 11:18 a.m.

Imperial Palace casino owner and Las Vegas Motor Speedway co-developer Ralph Engelstad, 72, died of cancer Tuesday night at his Las Vegas home.

A successful businessman and a philanthropist, Engelstad was one of the nation's few remaining independent casino owners.

His death throws into question the long-term future of the 2,700-room Las Vegas Imperial Palace, a centrally located property near Caesars Palace, The Venetian and Harrah's, among other flagship casinos. Also unclear is what will happen to his approximately 1,100-room Imperial Palace in Biloxi, Miss.

"This is something Las Vegas wants to see keep going," UNLV professor and gambling expert Bill Thompson said of the Las Vegas property. "It's a good convention property with lower rates and it was always full."

Though rumors about Engelstad's pending retirement have swirled about town for some time, he had not actively marketed the Imperial Palace for sale, brokers say.

In a letter issued today to the management, employees and friends of the Las Vegas Imperial Palace, Betty Engelstad said her husband passed away in his sleep at home Tuesday night after a "long and valiant battle with cancer."

"Ralph continued to conduct his business affairs up to the very end; but finally his body could no longer support his brilliant mind," she said in the letter.

"Before his passing, Ralph took all necessary steps to ensure the continuity of his business including the Imperial Palace hotel-casino. Myself, Betty Engelstad, with the advice and assistance of Ralph's longtime attorney Owen Nitz, and accountant Jeff Cooper, will oversee the hotel-casinos' continuing operations under the able management of Ed Crispell and all the many other very loyal department heads and employees of the hotel and casino," she said.

"Ralph always thought of all of you as his extended family and on behalf of Ralph and myself, let me extend many thanks for your past loyalty and industry," she said. "We will all miss him terribly but in his memory, we will continue to make the Imperial Palace a source of great pride, success and respect."

Many of the employees seemed downcast but operations went on as usual at the hotel-casino in Las Vegas.

Connie Ross, Imperial Palace's executive director of corporate advertising and publicity in Las Vegas, who has worked at the hotel-casino for 10 years, said she hopes Engelstad will be remembered for giving Las Vegas "a new industry in the Las Vegas Motor Speedway."

"Other things he did as an industry pioneer was that he was the first to establish a drive-through sports book and the first to establish an on-site medical clinic for Las Vegas guests and employees at the hotel-casino," she said.

There are 2,700 employees at the Imperial Palace in Las Vegas and 1,100 to 1,200 employees at the approximately 1,100-room Imperial Palace in Biloxi.

Ross said she hopes Engelstad won't be remembered for the different controversies he was involved in.

"He did have some extraordinary accomplishments. He was a genius as far as business goes. If he gave you his word, that was his bond," she said.

Engelstad, the grandson of Norwegian farmers from Minnesota, rose from humble beginnings to become a shrewd and competitive gaming operator. Yet his name will remain inextricably linked with two events that painted him as insensitive and racist.

"He was a tough guy who came up the hard way and stayed tough his whole life," said attorney Bob Peccole, a longtime friend who was the Imperial Palace in-house legal counsel from 1989 to 1995.

"But he also was a fair man in his dealings and was a man who gave away his money to help so many others. And he gave without seeking acknowledgement for it."

Peccole, a former member of the Nevada Gaming Commission, was close to Engelstad in the months following the controversy over Engelstad's Nazi memorabilia collection in the Imperial Palace in the 1980s.

He came aboard in June 1989, five months after the Nevada Gaming Control Board and Engelstad's other attorneys had reached a settlement to levy a $1.5 million fine against Engelstad for embarrassing the industry. It allowed him to keep his gaming license.

Engelstad had held parties in the resort's secret multimillion-dollar Nazi memorabilia room allegedly to observe Adolf Hitler's birthdays in 1986 and 1988. Engelstad later denounced Hitler, apologized for his error in judgement and emptied the room of nazi memorabilia.

"He was upset that people had interpreted his intentions so badly," Peccole said. Engelstad long maintained that the parties were to honor the employees who worked on the room, not Hitler.

"But few people really knew Ralph Engelstad. He was not a real open person. But I never heard him say a derogatory word about any person, group or religion."

Engelstad could be hard-nosed in all of his dealings, whether it was business or philanthropic. Such was the case in 1998 when he gave $100 million to his alma mater, the University of North Dakota, to build a field house for the hockey team.

"Ralph insisted that the school keep its (controversial) nickname, the Fighting Sioux, as a stipulation of the donation." Peccole said. "He felt it was the right thing to do."

Critics, however, called the Sioux name racist.

Engelstad, a goalie on his college hockey squad in the 1950s, had made several large gifts to the university, including a $5 million endowment his wife Betty established in 1988.

Born in Thief River Falls, Minn., Engelstad made his fortune first in the construction business in Las Vegas in the 1960s.

His company built commercial buildings at the Nevada Test Site and housing divisions in North Las Vegas. A street in that city is named for him.

In 1967, Engelstad sold 145 acres, including the North Las Vegas Air Terminal, for $2 million to billionaire Howard Hughes.

Engelstad used the money to purchase the Kona Kai motel which became the Klondike at the south end of the Strip. He eventually sold it.

In 1971, Engelstad purchased the old and decaying Flamingo Capri on the Strip and added some buildings and a casino. He reopened the Flamingo Capri a year later. In 1979, it became the Imperial Palace.

Engelstad used the resort to house his multimillion-dollar automobile collection that remains a popular attraction at the hotel. Ironically, one of the most valuable cars was Hitler's 1939 Grosser Mercedes parade car.

By 1989, Engelstad's wealth was estimated at $300 million, according to published accounts of the time.

"In some ways he was a lot like the people from the early days" of Las Vegas casino development, said Shannon Bybee, executive director of UNLV's International Gaming Institute. "People who make it on their own somehow ... want to do things their way."

Less known are his extensive philanthropical efforts. Engelstad has received both state and federal recognition for helping the disabled, including the "National Employer of the Year" award from the President's Committee on the Employment of People with Disabilities. About 13 percent of Imperial Palace employees have some form of disability.

He was also recognized as "Employer of the Year" by the Southwest Business, Industry and Rehabilitation Association and the "Humanitarian of the Year Award" from the International Gaming & Business Exposition. Several months ago, he was inducted into the North Dakota Entrepreneur Hall of Fame in recognition of his contributions in the construction, casino, entertainment and antique auto industries.

"Even though he was an intensely private, shy and reticent individual, Ralph was one of the largest philanthropists in America and he shunned any recognition for his good deeds," according to a statement issued by the Imperial Palace this morning.

Engelstad was a big player in the Mississippi gambling industry with his resort in Biloxi.

"We're sad to learn of his passing and expect his property, the Imperial Palace in Biloxi, to continue as usual," Leigh Ann Wilkins, director of public affairs for the Mississippi Gaming Commission, said.

Engelstad's Imperial Palace in Biloxi opened in December 1997. Mississippi's first casino opened in August 1992, while the Beau Rivage was the last casino to open in the state in March 1999.

"As the second to last operator to open a property on the Mississippi Gulf Coast, Engelstad did take a chance on the market and that chance paid off for him. Engelstad had the vision to see that there was still opportunity for growth in that gaming market," she said.

Engelstad also was one the central figures behind the creation of Las Vegas Motor Speedway. He and Bill Bennett of the Sahara Hotel provided the financing for and were the original owners of the speedway, before selling the $200-million plus facility to NASCAR track magnate O. Bruton Smith in December 1998.

"Without his vision for what motorsports could bring to Las Vegas, the Speedway obviously wouldn't be here today," said LVMS General Manager Chris Powell. "He and Bill Bennett took at least some type of a risk in building a speedway without a guarantee of there ever being a NASCAR Winston Cup date. But it worked out very well.

"The employees of the speedway and certainly the fans that enjoy the racing at the speedway owe him a debt of gratitude."

Gov. Kenny Guinn today added: "Ralph Engelstad was one of the real entrepreneurial pioneers of the Las Vegas strip. He was also one of the colorful characters that makes up Nevada's industry personality. He left his mark on our state's largest industry. He will be missed."