21 Apr Alex Meruelo sees L.A. Latinos as key part of his highest-profile bet: a Las Vegas casino
Three decades ago, a 23-year-old kid from Whittier, the son of Cuban immigrants, had an idea for a new kind of pizzeria — one that would serve predominantly Latino neighborhoods and offer then-uncommon toppings like chorizo and jalapeños.
He took over a failed pizza joint in Huntington Park, called it La Pizza Loca and, within five years, had more than two dozen locations and sales of nearly $10 million.
That bet on an untapped market became the foundation of the sprawling business empire of Alex Meruelo, a low-profile investor and entrepreneur who has just made his biggest and highest-profile bet yet — on a historic but faltering casino on the Las Vegas Strip.
But the top-dollar acquisition on the eve of the recession proved to be an ill-timed bet on Sin City — followed by other troubles, including revelations Nazarian had used cocaine and had paid millions to a convicted felon who had allegedly extorted him.
The SLS Las Vegas, formerly the historic Sahara, is on the north end of the Las Vegas Strip, an area that has struggled since the recession. (Ryan Forbes / AVABLU)
Now, Meruelo, who already owns the Grand Sierra Resort hotel and casino in Reno, believes he can succeed where Nazarian failed. And as with La Pizza Loca, appealing to Latino customers is part of Meruelo’s game plan.
"That doesn’t mean I’m only going to focus on the Hispanic market," he said. "I am Hispanic and I’m very proud of that, but that’s just one more underserved market we plan to go after."
Among Las Vegas visitors from Southern California in 2016, the most recent year for which statistics are available from the city’s Convention and Visitors Authority, about 26% were Latino — though they account for more like 45% of Southern California’s population.
The gaming floor of the SLS, which new owner Alex Meruelo and general manager Paul Hobson plan to renovate. They say it’s too dark. (Ryan Forbes / AVABLU)
Among his Meruelo Group holdings — a hodgepodge that includes real estate, construction companies, an Orange County bank and a maker of pre-packaged sushi — are KWHY-TV and KBEH-TV, two Spanish-language stations that run a mix of Mexico-focused news, classic Mexican movies and telenovelas. He also owns L.A.’s No. 1 and No. 3-ranked hip-hop radio stations: Power 106, which plays new music, and old-school station KDAY (93.5).
Otto Padron, a former Univision executive who runs Meruelo’s media holdings, said the TV and radio stations could not only advertise Meruelo’s hotel and casino properties but also promote concerts, events and nightlife at the venues and draw musicians who have relationships with KDAY and Power 106.
When Meruelo was 16 and still in high school at Rosemead’s Don Bosco Tech, he took over the tuxedo-rental business next to his parents’ shop. He saved up enough to start investing in property himself, first buying a small apartment building in Huntington Park and later a plot of land in Riverside that he’d later sell to Walmart, a deal he said made him a millionaire in his early 20s.
Alex Meruelo, right, and former La Pizza Loca executive Tony Tavantzis, in front of La Pizza Loca store in Buena Park in 1995. (Kari Rene Hall / Los Angeles Times)
After earning a business degree from Cal State Long Beach and starting La Pizza Loca in 1986, he snatched up apartment buildings amid the recession of the early ’90s, as property values in California were declining. He then sold them a few years later for almost five times as much, he said.
Younger brother Richard was chairman and chief executive of Meruelo Maddux Properties, a firm that was once the largest landlord in downtown L.A. before filing for bankruptcy in 2009. Older brother Homero has developed several high-profile projects in Miami but lost properties to foreclosure and was accused of failing to repay millions of dollars in deposits to buyers of condos that were never built.
Alex Meruelo announcing a failed bid to buy the NBA’s Atlanta Hawks in 2011. (W.A. Harewood / Associated Press)
That changed at least somewhat in 2011, the year he acquired his Reno casino and made an unsuccessful bid to buy the NBA’s Atlanta Hawks. Now that he’s bought a casino on the Las Vegas Strip, his days of flying under the radar are over.
That’s how he lost the Hawks. By his account, he and former owner Bruce Levenson agreed to a price — but league officials demanded he pay more.
"Now, in hindsight, I should have accepted," Meruelo said. "But I just stick to my principles."
Former owner Sam Nazarian spent millions on renovations at the former Sahara, reopening the resort as the SLS Las Vegas. (Ryan Forbes / AVABLU)
Hobson also plans to renovate one of the property’s three hotel towers, one where rooms were given a kind of urban-loft treatment with angular furniture, spare gray walls and exposed concrete ceilings.