'The Player' Hideaway Two Bunch Palms Resort Sold to Hollywood Producers (Exclusive)
The Desert Hot Springs property, said to have been gangster Al Capone's West Coast hideout, changed hands for less than $10 million.
Two Bunch Palms Resort & Spa, the Desert Hot Springs property that had a cameo in Robert Altman’s 1992 film The Player, has been sold to Hollywood buyers.
Along with real estate investor Gidi Cohen, the 270-acre property was acquired by producers Steve Markoff and Donald Kushner and entrepreneur Elie Samaha — the trio who bought Grauman’s Chinese Theatre last year.
According to Coachella Valley real estate sources, the buyers paid less than $10 million for the property, which is said to have been built in the 1920s by Al Capone and served as his West Coast hideout.
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The group acquired Two Bunch on Feb. 17 from several banks that had foreclosed on it (the property remained open during the foreclosure process, which was completed in 2010). The prior owner had planned to turn Two Bunch into a residential subdivision before the recession dashed those plans. The property is about 10 miles from Palm Springs.
Two Bunch, with 52 bungalows, is known for the naturally flowing mineral waters that fill its pools. It is one of several resorts and spas to take advantage of the area's natural hot springs. Planned upgrades to the property include enhanced spa facilities and a facelift for the property's restaurant. “We want to bring it to the days when you saw it in The Player,” says Cohen. Renovations are slated to be completed by the end of the year. “The property is really tired and outdated and we need to bring it to today’s standards.”
The new owners' potential long-term plans for the property at 67425 Two Bunch Palms Trail include construction of additional pools and launching a line of Two Bunch spa products.
Kushner, whose credits include Tron: Legacy and Monster, and Samaha, a controversial nightclub operator-turned-film producer, acquired Grauman's from a joint venture of Warner Bros. and Viacom Inc. for an undisclosed price in May. (Markoff, co-chairman of film finance and acquisition firm A-Mark Entertainment, was one of several minority buyers in the group that bought the famed Hollywood Boulevard movie house.)
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Samaha has a checkered history in the entertainment business. Though he has produced films such as Heist, The Whole Nine Yards and The In-Laws, Samaha is also known for his high-profile legal battle with German company Intertainment over allegations that he committed fraud by distorting the budgets of films made by his Franchise Pictures. Intertainment accused Samaha of defrauding it out of $75 million, arguing that he kept multiple sets of books for his films. The years-long case was settled in 2006, with Samaha paying $3 million to Intertainment.
The Grauman's owners have plans to refurbish the interior of the 1,200-seat theater, fix aging infrastructure and add dramatic outdoor lighting.
According to Desert Hot Springs lore, Two Bunch was outfitted by Capone with a sentry tower for armed bodyguards and featured undeground escape tunnels. Capone's alleged bungalow features what are said to be bullet holes.
Cohen says he isn't sure whether the stories are apocryphal, but adds that they are "classic Hollywood."
Andrew Kirsh of law firm Raines Feldman LLP, who represented the buyers in the Two Bunch sale, said that the deal is indicative of increased interest in the Coachella Valley hospitality market.
"As we have headed into 2012 there is a lot of deal velocity, and this deal illustrates investors' appetite to take on new opportunities and risk as they see a turn in the real estate market," he says
The sellers represented themselves in-house in the transaction.