There’s a reason Sam Nazarian, 35, is known as Los Angeles’ King of the Night. His hospitality group SBE, which owns the Bazaar by Jose Andres, Hyde Lounge, Gladstone’s and the Redbury and SLS hotels, has recently acquired the privately held competition—Syndicate Hospitality. SBE incidentally stands for SamyBoy Entertainment; named after Nazarian’s childhood nickname.
SBE’s acquisition nearly doubles Nazarian’s nightlife holdings and makes Nazarian the most powerful operator of clubs on the West Coast, with 12 venues. The purchase adds Hollywood-based MyStudio, MyHouse, Eden and Crimson/Opera to SBE’s portfolio, which includes the Colony, Industry and the Abbey.
SBE was established in 2002. The Iranian-American businessman has been buying up competitors and other hospitality-related companies since 2008 and through the recession.
Just a year ago, SBE operated 17 hotels, restaurants, lounges and nightclubs. Today it has grown to 25. By April 2012, Nazarian told the Los Angeles Times, he expects his privately held company will own or operate 35 venues and will expand into New York, Miami, Las Vegas and Houston.
“My drive is to be the best in the lifestyle space across all platforms,” the Beverly Hills-raised businessman said. “We can be everything to everybody. We’re looking to cover the $100 check averages as much as the $5 check averages.”
Despite the economic recession, SBE—which has around 3,600 employees—has been doing well. In January, billionaire Thomas Barrack’s Santa Monica investment firm, Colony Capital, injected $35-million into SBE to help the company expand east and eventually go public.
A month ago, however, Nazarian surprised many when he announced he was shutting down the iconic Sahara Hotel in Las Vegas, acquired in 2007 for an estimated $300 million. At first, Nazarian would not comment on the closure, but he now says the plan from the beginning was to temporarily close the hotel for renovation purposes and that he was always committed to reopening the hotel in 2014 with six restaurants and two nightclubs.
“We’ve spent $30 million in design development drives; we’re shovel-ready,” said Nazarian. “If we were admitting defeat, we would have admitted it.”
Nazarian said he wants to prove through his expansion that his all-inclusive business model is exportable; he believes he can transfer Los Angeles brands like SLS, Redbury, Cleo and Hyde to other cities, and eventually internationally.
In 2006, Nazarian was honored as the youngest executive to be named one of the “Top 100 Most Powerful People in Southern California” by the Los Angeles Times’ magazine and was named among “The Influentials” in Los Angeles magazine.
Nazarian’s wealth was originally through inheritance. His father was an Iranian construction kingpin, but lost a fortune during the 1979 revolution. After immigrating to the US and settling in Los Angeles, Nazarian’s father rebuilt his fortune as an early stage investor in Qualcomm, the wireless telecommunications research and development company. Nazarian used this trust fund to build and expand SBE
Nazarian went to Beverley Hills High School and NYU for college. He launched a successful Nextel franchise at the age of 21. Always the businessman, Nazarian began overseeing his father’s side real-estate operation.
In an interview in August 2005, Nazarian opened up about another area of interest to him. He said he hoped to use his perspective as an Iranian Jew to help end the Arab-Israeli conflict. “It may seem over my head, but I think I have a way of bringing people together through humor and personality,” he said, adding that he once accompanied his father to Ramallah to talk business with the late Palestinian leader Yasser Arafat.
