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Los Angeles group buys Crazy Horse Too for $3 million
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Gary Thompson/Las Vegas Review-Journal
Abraham Assil, right, managing member of the Los Angeles-based Canico Capital Group, and the company's local attorney, Michael Mushkin, stand at an auction of the Crazy Horse Too that never materialized Friday. Because there were no offers for the property, Canico, which owns the property's first deed of trust, ended up buying it for $3 million. » Buy this photo
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LAS VEGAS REVIEW-JOURNAL
They held a public auction for the Crazy Horse Too on Friday, but nobody showed up.
So the owner of the property's first deed of trust bought the shuttered strip club for $3 million -- tens of millions of dollars less than the club's worth during its heyday as a thriving hangout for mobsters, politicians and celebrities.
Abraham Assil, managing member of the Los Angeles-based Canico Capital Group, said it was too early to discuss his company's plans for the South Industrial Road property, which no longer has the ability to obtain liquor and adult entertainment licenses from the city of Las Vegas.
Assil left open the possibility that his company might try to persuade the city to rethink zoning laws that now prohibit a strip club there.
"It's something that we're going to have to evaluate," Assil said.
The company's Las Vegas lawyer, Michael Mushkin, added, "I think it's clearly in their best interests to at least try that. It's pretty obvious that without that entitlement, the property's going to have a substantially lesser value than it would with it."
That effort, however, could get complicated if the city shows interest in the Crazy Horse Too property, which sits in a redevelopment corridor in the shadow of the Strip.
Mushkin said a real estate agent who indicated he represented the city inquired about the property before the auction.
City spokesman Jace Radke, however, said he knew of no interest by the city.
The lack of bidding Friday brought an unceremonious end to a four-year struggle, mostly by the government, to sell the Crazy Horse Too in a depressed real estate market.
When the U.S. Marshals Service took control of the club in 2007, it had a value as high as $35 million.
The Marshals Service, which abandoned its effort to sell the Crazy Horse Too earlier this year, had hurt the club's value by letting its licenses lapse. Most estimates today place the club's value without the licenses between $2 million and $3 million.
Former owner Rick Rizzolo lost the club after he pleaded guilty to a felony tax charge in June 2006 to end a decade-long FBI racketeering investigation.
Rizzolo, long suspected of having ties to organized crime, agreed to pay several million dollars in fines and taxes with $10 million in restitution to Kirk Henry, a Kansas City-area man who suffered a broken neck in a fight at the Crazy Horse Too in 2001.
Rizzolo, who served 10 months of a one-year prison sentence, contends that had the government sold the club at the height of its value, there would have been plenty of money available to pay Henry and Rizzolo's other debts.
Federal prosecutors are seeking to send Rizzolo back to prison for violating the terms of his April 2008 supervised release .
Assistant U.S. Attorney Eric Johnson, who led the 2006 criminal prosecution of the former Crazy Horse Too owner, has accused Rizzolo in court of committing a "pattern of deceit" from the very day of his release. Rizzolo is alleged to have concealed from his probation officer a series of lucrative financial transactions related to a $1 million windfall he received from the sale of a Philadelphia strip club before his release.
U.S. District Judge Philip Pro has scheduled July 20 arguments on the government's effort
Contact reporter Jeff German at jgerman@reviewjournal.com or 702-380-8135.
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Of course they are going to try to get the zoning changed back! Otherwise, the property is worthless. It's just a crappy old building with limited parking on an industrial road. They paid $3 million, ON TOP OF the existing first trust deed of unknown $ they were forced to choke on. With the money this strip joint generated, I have to wonder why there was still a loan on the building in the first place.
Just wait.Carolyn Goodman will give the new owners zoning and a new liquor license as a favor to her husband's former and present criminal law clients.
Typical Government waste, they should pay for the Henrys law suit, they destroyed the value, wasted millions of dollars just like they always do.
Well at least it was the marshals. If ATF had taken control of it they would have burned it down.
Has to make you wonder about the people that are supposed to be running this country.
The government is the only ones I know that can get into the sex business and lose money each and every time.
@lonetrader-you hit the nail on the head. Sad but very true.
To FR: You are missing the joke. If the mayor can't have a liquor license, he wouldn't want it. Let me try to explain this better. The mayor likes to drink. He routinely has a martini in his hand. He was a rep for $50 grand a year to promote Bombay Sapphire Gin. If you still don't get it, let us know and we'll try to explain it another way.
YAWN, YAWN, YAAAAAWWWNN.
The Feds. couldn't run the Mustang ranch either. Just goes to show you how govt employee's have no clue to run a business. If the Govt made a deal with the owner, it would still be a profitable club. But, the ego of the govt got involved. Which is no common sense. Now they have lost a tax base, employment, etc. Way to go govt. You have showed us again you don't have a clue on how to run anything.
@travn8r
Since when does a new CITY HALL need a liquor license? I agree that most of the politicians seem like they're drunk most of the time, but I think that they carry their own and don't buy it at work.
Oscar is a visionary in spending taxpayer money for things and another new city hall would make him a legend!