Ghost of a Chance

The Balinese Room needs a gambler willing to bet the house - on its own future

Ghosts haunt the fabled Balinese Room in Galveston.

They aren't the ghosts of performers who've played the South Seas Ballroom there, like Frank Sinatra or Peggy Lee or Phil Harris. They're not even the ghosts of the gamblers who played in the most infamous illegal gaming room in Texas.

They're the ghosts of real estate investors who've come and gone, dazzled by the possibilities of restoring the famed site only to be humbled by the finances of doing so.

Complete with palms and piano, parts of the Balinese remain in mint condition.
David Wallace
Complete with palms and piano, parts of the Balinese remain in mint condition.

The big-dream boys have appeared regularly since the Balinese shut its doors in the late 1980s. October 1993, the Houston Business Journal: "Buyer Bids to Revive Fabled Balinese Room"; May 1996, the Houston Chronicle: "Preservation Group Hopes to Restore Balinese Room"; March 1998, the Chronicle: "A Revival of Galveston History: Legendary Balinese Room Expected to Reopen This Summer."

All those plans fell through, defeated either by the complexity of figuring out who owns the damn thing or by Mother Nature, which threw Tropical Storm Frances at the building in August 1998, ending the renovation project that looked like it had the best chance to succeed.

And now, in the spring of 2001, the guy who was beaten by that storm is desperately looking for a buyer, someone who can make needed repairs to the piers under the 400-foot covered walkway that goes from the seawall to the ballroom, before hurricane season comes and finishes what Frances started.


A tour of the Balinese today makes clear the daunting challenges and intriguing possibilities of the place. The covered walkway, famous for providing enough warning for the backroom gamblers that a raid was under way, sags noticeably just before it meets up with the main room.

When you reach it, you and your guide, Galveston realtor David Wallace, have to walk across the bowed section one at a time in order not to tempt fate.

But once past that shaky section, you walk by the coat-check room and enter the perfectly preserved South Seas Ballroom. Bamboo walls, parquet floors and a stage flanked by palm trees trimmed in black neon are all there in their swellegant glory, and you can't help but think back to the days when a night out meant "dining and dancing."

"It's amazing, isn't it?" Wallace says, and he's right.

He shows the tiny dressing room, where the stars perhaps wondered what the hell they were doing in Galveston, Texas, instead of the Copacabana. He then takes you through a door to the back room, where much of the Balinese legend resides.

From World War II to 1957, when officials finally decided they'd had enough, the Maceo brothers ran the most famous illegal gambling operation in the state here. Roulette and craps were the games of choice for the instant oil millionaires from Houston and Dallas who came to the island for some R and R.

When a desultory raid did occur, by the time the lawmen sprinted down the walkway and fought their way through the South Seas crowd (who were inconveniently standing by that time because the band would have struck up "The Eyes of Texas"), the chips would have been pocketed and the gaming tables flipped over or reattached to the wall. The Texas Rangers would find nothing but some elegantly dressed couples sipping drinks by a curved bar.

Nowadays, though, the back room is an empty storage space, not restored like the ballroom. At spots you can see through the floor to the gulf below.

But as you continue the tour, to the 4,000-square-foot kitchen with its cashier's room that served both diners and gamblers, the possibilities continually leap to mind.

Wallace is all too aware of that. "When someone comes in and takes a look around at all this, they just want to whip out their checkbook and buy it right then," he says. "But you better have some deep pockets once you buy it."


Bob Greig found out about the need for a bankroll when he bought the place in 1998. First, though, he solved one of the most complicated hurdles blocking redevelopment of the Balinese: whether the building was owned by the bankruptcy estate of the last guy who had it, or the state of Texas under the Open Beaches Act.

Thanks to years of steadily eroding beaches, almost all of the property is over the Gulf of Mexico, and the state claims any land that's under water at high tide. The bankruptcy estate of Johnny Mitchell, the man who ran a restaurant there until the late 1980s, also claimed ownership.

"If you did a deal with one, you were going to wind up in court being sued by the other," says Greig.

In a complicated settlement, Greig purchased the site from the Mitchell estate for $160,000, donated it to the state (for a nifty tax write-off) and then leased it for 60 years.

The Balinese is unique in that way, says John Kerr, a spokesman for the state's General Land Office. Texas has completely gotten out of the business of leasing any property for such boardwalk-over-the-water-type developments.

"The Open Beaches Act says you can't impede beach traffic with a development, and those things do, and we're looking instead to open the beaches up," he says.

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