Why Las Vegas Casinos Won’t Gamble On Cannabis

Allowing consumption lounges and other 420-friendly activities in the top casinos would put them at risk to lose everything.

In June 2023, real estate entrepreneur Alexandre Rizk opened The Lexi on West Sahara Avenue, just off The Las Vegas Strip as Sin City’s first cannabis-friendly hotel. The 46-year-old Rizik thought he had a “genius, million-dollar idea.”

Smoking weed is only allowed on The Lexi’s fourth floor, where every room is outfitted with air filters and every suite is numbered 420. The Lexi was the second cannabis-friendly hotel Rizk had opened after the Clarendon in Phoenix, Arizona, and he had ambitious plans to expand his weed-hotel concept under his Elevations brand across the West, from California to Oregon and become the “Kimpton of cannabis.”

Rizk soon realized that being cannabis-friendly was not really an edge in Las Vegas: While cannabis consumption is officially banned in casinos and on The Strip, enforcement is very lax. Rizk says many well-known properties turn a blind eye to their patrons’ vaping and other pot use.

Within five months of launching The Lexi, Rizk knew he had made a mistake as occupancy topped out at 30% and he started losing bids to host weddings and other group events to competitors who don’t cater to cannabis consumers. Rizk sold the Clarendon and is in the process of rebranding The Lexi. After he stopped advertising the property as cannabis-friendly, occupancy jumped 15%.

“Unfortunately, this venture could cost me my entire career,” says Rizk, who personally invested $5 million into the 64-room, adults-only hotel, which he bought with other investors for $12 million in 2022. “It brings a stigma to the property that it is a pothead gathering and most people don’t want to be associated with it.”

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