Scott Sonner / AP
This photo taken Oct. 20, 2021, shows Emerald Bay’s mouth to Lake Tahoe. One of the area’s once-famed hotels, the Tahoe Biltmore Lodge and Casino, scheduled to be demolished to make way for Waldorf Astoria Lake Tahoe, will survive a little longer, as one of the main investors in the project filed for default this week.
Thursday, April 11, 2024 | 2 a.m.
While it sits empty and waits stoically behind chain link fencing, the Tahoe Biltmore Lodge and Casino may have evaded the wrecking ball once more.
On Tuesday, one of the main investors in the property's rehabilitation filed a notice of default with Washoe County to the project's owners, EKN Development. It ostensibly brings the planned redevelopment of the storied north Lake Tahoe casino to a standstill, for at least the next 90 days. The project would have seen the Biltmore property transform into the Waldorf Astoria Lake Tahoe.
The notice of default was filed on behalf of the investor by a trustee, a San Diego branch of First American Title Insurance Company.
The filing seeks $82 million "which became due on 3/11/2024 plus accrued interest and late charges," according to the notice of default. Nevada law gives EKN Development, a Newport Beach developer, 90 days to align with new investors and make good on the payment, "which is more than what I need," Ebbie Nakhjavani, founder and CEO of EKN, told SFGATE.
"We've been working with multiple institutions," he continued. "There's a lot of interest in the project."
The need to do some on-the-fly financial reorganizing isn't the project's first delay. After EKN purchased the property in the fall of 2021 for $56.8 million, the company initially announced that the teardown of the property's main building would be completed by the end of 2023, with new construction starting this year.
EKN shut down the original Biltmore for good on April 30, 2022, to make way for the new development. Despite some early delays, the original building, built in 1946, was projected to come down this May, Nakhjavani told SFGATE in January. He still believes finding new backers in a short time frame is a probability and that the demolition and rebuild will remain "relatively on schedule."
"The goal is still to demo the building this summer," he said. "We're still planning to do all of that. We're pretty much on plan and on target."
Tahoe Regional Planning Agency public information officer Jeff Cowen wrote in an email to SFGATE Tuesday that even if the EKN/Waldorf Astoria project is working through some behind-the-scenes issues, "at this time, the project still has a valid permit and it will remain valid as long as the project owners show diligent pursuit of the permit."
"The Waldorf Astoria Lake Tahoe team has reiterated the company's commitment to the project to TRPA and we're awaiting updates as they become available," Cowen continued.
This is far from the first time the mighty Biltmore has dodged the wrecking ball, seemingly with hours to spare. The hotel-casino on the shores of Crystal Bay in north Lake Tahoe was once famous for its $1.99 breakfast, its resident ghost Mary, and its fabled Nevada Room, a lounge area that hosted A-list 1960s cabaret acts like Rowan and Martin, Rudy Vallee, Soupy Sales and Regis Philbin.
But the hotel-casino fell into a long decline over the past decade after Incline Village-based entrepreneur Roger Wittenberg purchased the 16-acre parcel in the spring of 2007 for $28.4 million.
Wittenberg planned to raze the old Biltmore and build a hotel, wellness retreat and public space called Boulder Bay. But the financial crisis of 2007-2009, as well as years of planning back-and-forth with the community and the Tahoe Regional Planning Agency, eventually became too much for Wittenberg. The casino slipped into disrepair. By 2017, he had begun to look for a buyer.
"The timing just wasn't right, economically," Boulder Bay President Heather Bacon, Wittenberg's daughter, said in 2017. "And at the end of the day, that would have hurt the community."
Even with the financial setback, EKN anticipates its construction schedule will stay on track, breaking ground in 2025. The Waldorf Astoria is slated to open in 2028.
"The financial restructuring is a necessary step in delivering a successful project on the iconic Tahoe Biltmore site," an EKN statement released late Tuesday night said. "Plans remain in place to perform the required site work and property revitalization improvements."
Still, with this latest financial setback, some locals remain skeptical. "A project as large in scope as the Waldorf Astoria introduced major financial, development and environmental threats to the community," Ann Nichols, a Crystal Bay real estate agent, wrote in an email to SFGATE Tuesday. "... In the future, the community would benefit most from redevelopment projects that are right sized for the fragile Tahoe Basin environment."
EKN's Nakhjavani said he understands that the public may have concerns when it comes to projects of this size, especially when there's an unexpected "financial restructuring." At the same time, he said that the developer is "working through a solution, so it works for everyone."
"Though this is a curveball, all of our focus is now dealing with this making sense for all parties," Nakhjavani concluded.
