Real estate entrepreneur, Alexandre Rizk, recently opened The Lexi. It is the first hotel in Sin City to allow guests to smoke marijuana in their rooms. Rizk does not hide the fact that he would like to build a whole network of such devices in the future.
New boutique hotel
The former Artisan Hotel, located just off the Strip, has been transformed into The Lexi. It became famous among locals as a nightclub where wild sex parties were held, but today the 64-room Lexi is for adults only and is officially the first hotel in Vegas to allow guests to smoke marijuana on its premises.
«We’re open to it, but it’s not something we’re building on,» says Alexandre Rizk, a 44-year-old real estate entrepreneur. Alexandre Rizk, together with a small group of investors, bought The Artisan hotel for $12 million in March 2022. This distinction that Rizk mentions is important. Marijuana will not be sold in the new boutique hotel, and even guests who do not use it will not be disturbed by its smoke.
Hotel Lexi opened in early June — shortly after Rizk spent about three million dollars on renovations. This included a state-of-the-art air filtration system on the fourth floor, where all apartments are numbered 420a, 420b and 420c. Only paying guests who have rooms on this floor can use marijuana in the hotel. An apartment here costs from 180 to 400 dollars per night. Smoking is not allowed in public areas, including the swimming pool.
Gray zone
As befits a new hotel in Las Vegas, Lexi is also trying her luck when it comes to marijuana laws. He is not actually licensed to use it. Hotel Lexi wouldn’t even be able to get it without changes to the state’s cannabis laws, which prohibit dispensaries or other marijuana establishments from opening within 450 meters of a casino. Although the hotel itself does not have a casino, it is located at this distance from the Palace Station gaming room. However, it is not yet clear whether Hotel Lexi needs a license to allow guests to smoke in the rooms.
The recreational use of marijuana has been legal in Nevada since 2016, but public consumption is prohibited — even if a quick glance at the boulevard suggests otherwise. Buying marijuana here is very easy for the 38 million tourists who visit the city every year. However, finding a hotel where you can smoke it legally is quite difficult.
Even state cannabis regulators admit The Lexi’s plans are in uncharted territory. «Lexi has no state cannabis license, including a cannabis lounge license,» Tiana Bohner, public information officer for the Nevada Hemp Enforcement Council, told Forbes. «CCB has not been contacted by the company, so without further information we cannot comment on the legality of their specific business plans.»
The «gray zone,» as Rizk calls it, refers to what is considered a private residence under Nevada law. «It’s questionable what goes on in the guest room,» admits Bohner. Nevada state law defines a private residence as «any building, buildings, or part of a building owned or leased by a public or private entity that serves as a private, non-transitable dwelling unit.» These include single-family and townhouses, semi-detached houses, condominiums, mobile homes and apartments. However, according to the law, «private residences do not include hotels or motels.»
The Nevada Attorney General’s Office declined to comment on The Lexi’s bold business model. «The answers to these questions could represent legal advice that our office cannot provide,» says John Sadler, director of communications for the Nevada Attorney General’s Office.
But Rizk is adamant: «We don’t break any rules.»
Network expansion
Rizk is not a likely candidate to open a «grass» hotel despite his business chops.
He hardly ever smokes marijuana, although he lit one at The Lexi Hotel during the celebratory dinner after he bought the property. The Montreal native moved to Phoenix after serving eight years in the Canadian military. He spent almost two decades in the field of real estate, where he ran his own hotel office.
In 2016, he founded the company Pro Hospitality Group (PHG). He deals with investments in hotels, searches for interesting properties, gets money from several investors for a down payment, renovation, and the rest of the missing funds he will establish the company himself.
Rizk, who owns 60 percent of each property, currently owns and operates 10 hotels. Most of them are located in Arizona. PHG has raised approximately $30 million to purchase the hotels, and its portfolio is valued at approximately $110 million.
Rizk credits the pandemic with inspiring him to operate two hotels that allow the use of marijuana. Both are now part of Rizka’s brand of pro-marijuana boutique hotels called Elevations Hotels and Resorts.
In 2019, PHG bought The Clarendon Hotel. “We bought it, renovated it and increased sales,” he says of the downtown Phoenix property, “and kept the good name the hotel had. But then covid came.»
The Clarendon Hotel has always been a funky place with DJs, drag shows and similar events. After Arizona legalized recreational marijuana in November 2020, Rizk believed that adapting the facility to smoke marijuana would help attract more travelers and offset losses from the lockdowns.
«We thought that with a new concept we could try to get back what we had before covid,» he says. «We started hosting high-end five-course cannabis-infused dinners served on the roof. We called them Elevated Under The Stars. The menu cost $250 per person.”
The Clarendon’s marijuana-based concept has helped bring its occupancy back to 85 to 90 percent. And a new source of income – cannabis brands, including local grower Mohave Cannabis Co. and former NFL player Ricky Williams’ brands — Highsman — now pay the hotel to sponsor the suites.
Lexi is an important test for Rizko. He plans to expand his Elevations brand to Los Angeles, Palms Springs, San Francisco and Oregon.
Other plans
Hotel Lexi will never sell marijuana. But Rizk hopes to one day expand his offering to include a smoking lounge and host marijuana-infused dinners in what used to be the hotel’s wedding chapel.
“Every city has different laws,” he says. In Arizona, where property owners have the right to ban or allow the consumption of marijuana, the hotel can host cannabis-themed parties. «In Phoenix, we follow it as well, but Vegas doesn’t allow it yet. They are very specific there in this regard, and we comply with that,» he says.
Of course, in Sin City, the rules are always a little looser. Especially in the area where Lexi is also located — on West Sahara Avenue off the Las Vegas Freeway. The hotel opened in 1979 as a Travelodge, but in 2001 the new owner renovated it and renamed it The Artisan.
In 2008, the four-story hotel was headed for bankruptcy, and a few years later it was bought by the mortgage holder. According to a local artist who attended nightly parties at The Artisan Hotel, the hotel gained a reputation as a place where locals went to party freely and where management «turned a blind eye» to drug use.
Groups could also rent the entire venue for less than $10,000. The Artisan also became known as a swingers hotel .
«I’m going to try to be as aggressive as possible,» he says. «I would like to open five to six hotels with the same concept as Elevations.»
Rizk says his competition so far consists of small highway motels that allow guests to smoke marijuana. He refers to them as «hippie retreats» in the woods.
And what if Rizko’s friendly approach to marijuana turns off too many guests? «If it doesn’t work out,» he says, «we still have a boutique hotel in Vegas to take care of.»
