William Wilkerson - Construction and The Eastern Syndicate

Construction and The Eastern Syndicate

From the moment Wilkerson bought Margaret Folsom's land to the day he broke ground was almost a year. Construction on the Flamingo Club began in late November 1945. The project, for building purposes, was known as W.R. Wilkerson Enterprises. The builder was Bud Raulston, another person Wilkerson had worked with extensively on his Hollywood projects. Raulston began bulldozing the two dilapidated "motel" shacks.

Within six weeks, foundations had been laid for the kitchen, bar and dining room; a basement excavated and the piping completed. Soon, all the main girders for the building's shell had been erected. Nearly a third of the construction was complete before Wilkerson ran into unexpected difficulties. In the immediate post-war period, labor was plentiful but wartime regulations and restrictions still made building materials extremely scarce. When materials could be obtained, they were invariably astronomically expensive. These inflated costs soon exceeded Wilkerson's budget. He had already sunk $300,000 into the operation. His current gambling losses and debts to Moe Sedway brought the grand total to just under $400,000. In a last-ditch attempt to raise an additional $400,000 capital for completion costs, Wilkerson once again turned to the gaming tables. He staked $150,000 of his remaining $200,000 and lost it all.

With the majority of his construction capital now gone, Wilkerson looked desperately to Hollywood. Wilkerson offered bargain-basement advertising rates in exchange for surplus lumber and metal. He cajoled several studio heads into donating materials from their back lots. The publisher even went so far as to threaten some movies executives that key movies would not be reviewed unless they agreed to provide him with supplies. But these scavenged supplies added little of real value to the construction effort, and by early January 1946, Wilkerson's project had ground to a complete standstill. Dismayed, he paid everyone off in cash and left the Flamingo's shell lying like the skeleton of some strange giant, beached in the hot, empty desert.

As the publisher reached the end of his financial tether, Moe Sedway was bringing Billy Wilkerson's project to the attention of Meyer Lansky. Sedway saw it as a unique opportunity for their group to expand operations in Las Vegas. At first, visionary Lansky did not share Sedway's rosy opinions about the future of gaming in the Nevada desert. Lansky initially had pictured Wilkerson's operation as a modest casino and nightclub and doubted whether they alone would be enough to draw the crowds Sedway spoke of to an unspeakably hot desert. But once Sedway reported on the grandness and scale of Wilkerson's schemes, Lansky began to see the visions of money being made in the air-conditioned desert. A decision was taken to invest in Wilkerson's project.

The first step was the approach to Wilkerson. Someone unknown to the publisher had to make him an offer he could not refuse. The site stood empty for well over a month as Wilkerson teetered on the brink of abandoning his dream project. In late February 1946, he and his builder Bud Raulston were touring the construction site when an expensively dressed man drove up and approached them. He introduced himself as G. Harry Rothberg, a businessman from the east coast. Rothberg said he represented a firm in New York that wished to invest in the Flamingo Club. He and his associates knew that Wilkerson was broke and were willing to help him complete his Las Vegas venture.

Rothberg outlined his proposal. In exchange for funding, Wilkerson would retain a one-third share in the project. Included was the contractual promise that he would call all creative shots. When the club became operational (no later than March 1, 1947), Wilkerson would be its sole operator and manager; all others would be silent partners. Rothberg asked Wilkerson how much capital he needed to complete the project. Without hesitation Wilkerson replied, "One million dollars." Rothberg said that if the deal went through, Wilkerson would be advanced completion funds totaling that amount, with a guarantee that he would not have to put another dime of his own money into the project. Wilkerson thanked the mysterious gentleman and said he would take the offer under consideration.

While Wilkerson disliked partners, he had no qualms about investors - people who put up cash in exchange for a slice of the profit pie and then got out of the way. Overall, Wilkerson found the Rothberg proposal attractive. He agreed to all of Rothberg's terms except for one. He demanded that he retain complete ownership of the land. Rothberg consented.

On February 26, 1946 a contract was signed between Rothberg and Wilkerson. In early March, W.R. Wilkerson Enterprises received $1,000,000 to complete the Flamingo Club, which Wilkerson renamed, the Flamingo Hotel. With a year to meet his deadline, Wilkerson happily resumed construction. But the ink on the contract had not been dry for more than a month when Moe Sedway and Gus Greenbaum, both of whom the publisher had already done business with on this same project, visited the construction site. They brought with them a loudly-dressed character who enthusiastically presented himself to the publisher as his new partner. This man was Ben Siegel.