Bugsy Siegel – Vegas Real Estate & The Mob

April 07, 2017 at 10:04 AM

Bugsy Siegel – Vegas Real Estate & The Mob

“Las Vegas: all the amenities of modern society in a habitat unfit to grow a tomato.” - Jason Love

Back in the early 1940’s, Las Vegas was a barren chunk of land in the Nevada desert, with little or no development.  Bugsy Siegel, one of the Mafia’s most violent and infamous gangsters, dreamt of building a “mecca” hotel that would be so unique in design and decadence that it would be unrivaled.  At the time, Las Vegas was not very developed and there were no hotels or buildings that would have been similar to Siegel’s vision.  Bugsy was the “go to” guy for getting things taken care of for the mob, and one of its most trusted gangsters.  Financially backed by Al Capone, Bugsy’s Vegas dream seemed doomed from the start.  He had no background in construction, and was so filled with self-importance, that he thought that he could build the Flamingo, which was to be so much different than the existing landscape. The black and white photo above shows the Flamingo Hotel under construction.

Siegel knew very little about construction and the project went over budget (estimated cost $1M but the actual cost was something over $6M).  The mob bosses who had financially backed Siegel were so angered by the delays and cost overruns  that they had a meeting in Cuba and discussed if they should order a hit on Siegel.  He opened the Flamingo in Dec 26, 1946 unfinished.  It remained open for two weeks and later shutdown to complete construction. On June 20, 1947 a mob hit-man travelled to Beverly Hills and shot Siegel as he was reading the Los Angeles Times.

One of his biggest mistakes was his inability to manage a construction development project, and protect the assets. According to his records, if he had used a developer to oversee the construction of the Flamingo, the losses would not have been as staggering as they became under his direction.

The real irony in the Bugsy Siegel real estate investment saga: Siegel was right on with his high-end, no-expenses-spared Havana-inspired casino resort concept. His general concept is that upon which all of Las Vegas’s success is based today.

By the 1950’s, there was a number of hotels that had been constructed to create the famous “Vegas Strip” still seen today.  By this time,  the more high-end resorts like the Flamingo were being described as self-contained cities. There were three artesian wells on the property supplying fresh water to the hotel and its customers.   There was a backup power plant ready to supply power to the hotel in case of a black-out.  The resort also had its own heating plant and sewage system.  Sounds as though Bugsy’s vision became a reality a decade after his own death.  And now you know the true history of the Flamingo Hotel and every time you visit Las Vegas, you will think of mob bosses, real estate and Bugsy Siegel.

Best Regards,
Brian & Myles McCullough
www.mmshomes.com

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