The Rusty Palms has a new owner.
Two weeks after he won the auction for the defunct resort Celtic Bank approved former Wendover, Utah Mayor’s Steve Perry $450,000 bid for the defunct resort
Perry’s winning bid was less than double the $250,000 opening call. According to the rules of the auction the bid must be approved by the seller, Celtic Bank, who also has first right of refusal.
While Perry’s bid is less than 20 percent of the construction loan Celtic Bank lent builder Steve Weinstein to build the Rusty Palm cutting its losses might have been the best course of action.
The Rusty Palms won final approval from the West Wendover City Council in November 2008 and construction began almost immediately and continued through the winter on the estimated $2.5 million project. However while workers began building Weinstein began to receive troubling news, several of the businesses who first expressed interest in began to receive troubling news, several of the businesses who first expressed interest in coming to the Palms either backed out or went out of business as the Great Recession began to take its toll in Utah.
Facing prospects of a diminishing list of possible tenant Weinstein began to look for ways to save his investment and found one– turn it into a casino.
The only hitch to the plan was West Wendover 200 room hotel room minimum ordinance passed the year before.
The restrictions are not unique to West Wendover. Indeed several Nevada cities have similar restrictions on the books.
However in West Wendover’s case the city has not seen a new casino since 1986 with the exception of a small slot operation inside the Pilot Truck Stop. And while Weinstein left the Rusty Palms when Celtic Bank foreclosed four years ago the hotel room minimum has haunted the project ever since.
Despite being aggressively shopped around no real serious buyer has looked at the Rusty Palms largely because of the room restrictions. Perry’s price for the project was so low that he could perhaps afford to build those 200 hotel rooms that proved such a burden to the project in the past.
When interviewed Tuesday Perry said his plan for the property were up in the air.
“(West Wendover City Manager) Chris Melville suggested that we put an RV Park there,” Perry said. “But we still have to think about it.”
