Why a developer gave up his casino dream
Appeal Staff Writer
For about two years, developer Kevin Coleman wanted to build a casino at the southern entrance to the capital city. In terms of location, it has everything: Access to Highway 395 South and Highway 50, the future freeway will empty near that intersection, there’s a park next door and a large retail center down the highway.
Even more compelling, the three acres at the corner of Old Clear Creek Road and South Carson Street has an unrestricted gaming license.
“The value of an unrestricted gaming license in the state of Nevada is worth the cost of a 100-room hotel, which could be as high as $20 million,” Coleman said Thursday. He’s the owner of K&S Properties of Costa Mesa, Calif., and Net Development. Carson City requires new gaming properties to build a 100-room hotel.
There’s another property in Carson City that sits vacant because the owner can’t build the casino of his dreams. Max Baer Jr., a former Hollywood star, has been unable to develop the vacant Wal-Mart building, also located on South Carson Street, for more than three years. Baer’s plans to turn his property into a destination casino were interrupted by a dispute with the other shopping center tenants over its regulations against casinos.
Coleman did what Baer has refused to do so far. He sold it.
That corner of gaming heaven is being developed by a different man, Washington state investor Mike Pegram, who bought the property from Coleman last month for $4.8 million, about $800,000 more than what Coleman bought it for from the men who operated Bodine’s restaurant, which stood on that intersection for 20 years.
Coleman has lost money. He wishes he could’ve made it work. Coleman said he had an operator when he bought the property. The operator backed out after the sale closed. Coleman declined to give his name. He said it was because the casino was too small for his operations.
As an outsider, getting into Nevada gaming is no easy task.
“It’s like breaking into Fort Knox,” he said. “Because the history of Nevada gaming started from fairly shady roots, they, in the wisdom of the Nevada State Gaming Board, have done a wonderful job of saying, ‘We’re not going to let anybody into this business who isn’t qualified.'”
Coleman said he could obtain the license, but couldn’t prove to the board that he was qualified to run a casino.
Competition from the corporate casino giants was also too much for him. Coleman wanted to be a landlord to gaming. He talked to many different operators and they all want to own their property.
But, can Pegram, who is from out-of-state, make it work?
“He’s already done it,” Coleman said about Pegram finding a partner. “It’s a Reno family that’s going to be involved.”
Coleman, 54, could’ve done retail. He said he had offers of $6 million for the land to develop it into a retail center. Appraisers valued a retail center on that corner at $15-$20 million. But if retail was put there, the agreement with the city parks and recreation department to improve the fairgrounds with a $1 million contribution in exchange for overflow parking would not have come through, he said. Pegram inherited that deal with the city.
The gaming license would’ve been lost. It would’ve taken years to redesign and re-permit the site for a retail center.
“When I drive by it in five years it’s going to be the premier corner. It’s going to be exactly what I envisioned it to be. Mr. Pegram will do just that.”
Coleman is not planning any other development in Carson.
• Contact reporter Becky Bosshart at firstname.lastname@example.org or 881-1212.