Question of the Day - 16 February 2020

Happy to -- especially since we answered a question about Webb 10 years ago and nothing has changed since then. Here it is.

You could say Del Webb got in on the ground floor of Nevada's casino industry. He was the contractor Bugsy Siegel hired to finish the Flamingo, which Siegel had taken over from Billy Wilkerson. As A.D. Hopkins writes in The First 100, "Webb walked a thin and dangerous line with Siegel, but it was all in a life's work." It probably didn't hurt that his client always paid in cash.

According to Hopkins, Webb (1899-1974) was a fast and innovative builder. When a would-be career in baseball went bust, Webb reinvented himself as a contractor, starting off with a cement mixer and 10 wheelbarrows. Yet even in the lowest ebb of the Great Depression, Webb became a multimillionaire, a status he solidified with World War II contracting work and some shrewd investments.

Webb was firmly affixed to the Vegas map by the time Siegel came along in 1946. Since his men had no Flamingo design from which to work, they followed verbal directives from Siegel and "designs" were rendered after the fact. A man of carefully ordered routine, Webb wasn't personally drawn to the gambling business, although he built landmark casinos like the Sahara (1950) and The Mint (1956).

Webb's name was essentially lent to the gambling industry by longtime employee and eventual Del Webb Cos. President L.C. Jacobson. He bought a 20% interest in the Sahara at its inception and, a decade later, swapped his Sahara ownership to Del Webb Cos. in return for an equity position in the latter. The deal "enabled us to clean up the Sahara," said former Webb executive and eventual Sahara owner William Bennett. It also marked the first time a publicly traded company owned a Strip casino. The Mint came as part of the package and was branded with the Webb name.

To get around Nevada regulatory scrutiny, Jacobson and Webb ran their casinos via a shell company, Consolidated Casino Corp. "This managing company paid a rental fee to [Webb Cos. subsidiary] Sahara-Nevada that just happened to match its gaming receipts," writes David G. Schwartz, in Suburban Xanadu.

Following Jacobson's 1961 stock swap, Webb Cos. jumped into the gaming industry with both feet, briefly becoming the biggest casino operator in Nevada. Acquisitions included the Thunderbird (1964), a few doors down the Strip and future site of Fontainebleau. The Sierra Tahoe (subsequently Del Webb's High Sierra) followed in 1965. In 1974, Webb Cos. bought Club Prima Donna in Reno, renaming it Del Webb's Primadonna and then cannibalized it in 1979. Its remnants became part the adjoining Del Webb's Sahara Reno, built in 1977. Along the way, Webb's companies also picked up the Lucky Strike Club downtown and the Nevada Club in Laughlin.

"The Nevada resort operations did the main thing they were supposed to do for Del Webb Corp. -- insulated the company against misfortune in other endeavors," writes Hopkins. He also notes that the company was a leader in sponsoring events, from a Beatles concert to the Mint 400 Desert Rally off-road race, to lure players.

After Webb's death (he was a heavy smoker), the casino assets were dispersed. The Thunderbird was sold in 1976 and the Sahara Reno went over to Hilton Hotels in 1981. (It's since closed; the Thunderbird became the Silverbird, then the El Rancho before being imploded in 2000.) The original Sahara was purchased in 1982 by Paul Lowden, who flipped it to Bennett in 1995. Webb's successors had come a-cropper in their 1978 attempt to breach the burgeoning Atlantic City market. Their purchase of the President and Claridge hotels was a costly disaster, leading to a $92 million loss in 1987.

To recoup Webb's fortunes, The Mint was sold and became part of Binion's Horseshoe (now simply Binion's) in 1988, and the Nevada Club was liquidated to Steve Wynn that same year – and promptly closed, reopening in 1989 as the Golden Nugget. The High Sierra came under the aegis of hotelier Columbia Sussex in 1990 and was re-renamed the Horizon.

Thus ceased the Webb casino empire, which began with a bang and ended in a whimper. Since the Reno and Atlantic City expansions postdated Del Webb's death, it's open to debate just how much of a player in the industry he personally was. However, he was the first entrepreneur to marry the Strip and Wall Street, via his Sahara/Mint deal. Also, the gentlemanly fiction whereby he outsourced casino operations – and vacuumed up the revenue – through a puppet company is a precedent honored by Nevada regulators to this day. For those reasons alone, his place in the casino pantheon is assured.