Saturday, June 19, 2010
By: Andy Vuong, The Denver Post

CENTRAL CITY – In 2004, construction superintendent John Zimpel returned to this once-flourishing gambling town to freshen up a rental property.

He ended up buying a city block.

“I came up to clean my house and everything was closed,” said the Littleton resident, who in the early 1990s oversaw the construction of some of the town’s now-shuttered casinos.

Battered by competition from Las Vegas-style casinos in Black Hawk, Central City’s rundown properties were selling on the cheap, Zimpel said. So he rolled up five adjacent buildings for about $1.5 million and partnered with Century Casinos on a $50 million casino and hotel development that opened in 2006.

He sold his stake a year later for “several million” in profit – money that bankrolled his latest project, Johnny Z’s Casino, which opened June 9.

Central City’s first new casino in four years has injected excitement into locals, reviving hopes of a turnaround.

“The best thing that can happen to us is to have a quality new outlet come to town,” said Ross Grimes, whose family owns the Famous Bonanza and Easy Street casinos. “Rather than competition, it increases the activity and gives more people an opportunity to see Main Street and what a great place Central City is.”

From an industry standpoint, the timing of Johnny Z’s launch isn’t exactly opportune.

Once deemed recession-proof, casinos were hit hard over the past two years as consumers cut back on discretionary spending. The parent companies of two casinos in Central City and Black Hawk are bankrupt, and a third is expected to file soon.

But the biggest challenge?

“It’s getting away from the Central City stigma,” said Craig Ramirez, Johnny Z’s general manager.

Central City’s generally smaller and tired casinos generate about $5 million in gaming revenue a month, while Black Hawk’s properties rake in about $45 million. Last month, Central City’s casinos posted a 4 percent decline in revenue, while Black Hawk’s reported an 11 percent boost.

Though Johnny Z’s is truly a mom-and-pop operation – it is named after Zimpel’s 19-year-old son, who works the coffee stand – the casino also exudes the glitz and glamour seen down the road.

On a recent weekday, two orange Camaros – a vintage 1969 model and a 2010 version – welcomed visitors at the entrance, accentuating the casino’s car theme.

Inside, the updated look draws comparisons to Black Hawk’s Ameristar, a mega-casino that features a $235 million luxury hotel and spa.

Zimpel bought the three-story, 21,000-square-foot Johnny Z’s building – known in the 1990s as the Central Palace Casino – for $725,000 in November from George Maloof, owner of the Palms Casino in Las Vegas.

With renovations, total costs reached $5.5 million. Investors include Zimpel’s sister, in-laws and neighbors, who also invested in his first casino project.

Zimpel, 51, said he worked five months straight without a day off to oversee the makeover of Johnny Z’s. The casino boasts 37 flat-panel TVs, a restaurant, a smoking and barbecue deck, about 200 slot machines and six table games.

“I could’ve just vacuumed the carpet, changed the light bulbs, put a fresh coat of paint on it and opened up and we would’ve done OK because I got the building for cheap,” Zimpel said. “But it has to be something different.”