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Property once owned by Frank Sinatra fails to sell at foreclosure auction

The Cal Neva Resort at Lake Tahoe is to be run by a private management firm to keep it open in the short term. Canyon Capital Realty Advisors, a Los Angeles based investment group, took ownership of the hotel-casino after no bids were received at foreclosure sales in California and Nevada.

It has appointed NHH Hotels & Resorts, the management arm of National Hospitality Holdings LLC, a Philadelphia-based company that specializes in hotel investment and management.

'We've made it very clear that our plan is to keep the property open while we assess the property and its future,' said Jonathan Roth, a spokesman for Canyon. He confirmed that the company is talking to potential investors.

Among other things, he said efforts are being made to rejuvenate wedding and event-driven business at the 13 acre property on Lake Tahoe's north shore.

'Cal Neva is an historic property located in one of the most beautiful settings in the West,' said Richard Bosworth, a senior director at the firm.

Canyon filed a default notice against the Cal Neva in December after its owner, Namcal LLC, failed to make payments on a $26.8 million debt. Namcal bought it from former owner Charles Bluth in February 2005.

Roth said the fact that a third of the property is in California and the rest in Nevada may have hampered the auction process as there had to be one in each state. He thinks this 'masked' the true market value and could have dissuaded any interested purchasers. No bidders offered the minimum opening bid of $15 million.

Sinatra owned the Cal Neva from 1960 to 1963, often drawing Hollywood stars such as Marilyn Monroe, Peter Lawford, Dean Martin and Sammy Davis Jr. to the shores of Lake Tahoe.

But the singer's gambling license was stripped by the Nevada Gaming Control Board after Chicago mobster Sam Giancana showed up at the resort.

The present resort was built in 1937, when a fire destroyed the original lodge that opened in 1926.