ENSENADA¾ Hotel Playa Ensenada’s story began in 1924 when a group of entrepreneurs formed the Ensenada Beach Club, S. A., in Baja California to create the resort. This enterprise was founded in Mexico to capitalize on the profits made along the border during the prohibition in the U.S.; alcohol remained legal in Mexico during this time.
Between 1919 and 1933, many people had invested in casinos, hotels, broth els, and saloons south of the border where liquor was easy to obtain, buy, and sell. Ensenada was chosen for the site of the new beach club because of its competitive location 65 miles south of Tijuana and Mexicali. In 1928, the American professional boxer Jack Dempsey, once a world heavyweight champion, became the public face of Hotel Playa Ensenada which sold itself as a place to enjoy sportfishing, hunting, and beach activities.
By June 1, 1924, the beach club was comprised of 100 founding members, plus an advisory council of 10 members.
As a first step to ensure the success of the future hotel, investors arranged for transportation to get tourists from California to Ensenada. The club requested the services of a Los Angeles-based California Marine Transportation Company to authorize exclusive rates for passengers who wanted to go to Ensenada in the company’s steamers. In August 1924, the ocean transport company agreed to this and set a special rate for travel to Ensenada.
After establishing the agreement for the transfer of passengers by sea, members of the Ensenada Beach Club approached the Douglas Aircraft Company based in Santa Monica. Due to the great success that the American aeronautical industry was having, airplanes being an attractive and novel means of transportation, it was decided that the company would be ideal for carrying tourists to Baja California.
The hotel’s opening brought favorable economic benefits to the Mexican federal, state, and municipal governments since, among other things, it was stipulated in the contract that the Ensenada Improvement Company (EIC) would pay 25 percent tax on the profits collected in the hotel for the license of games and sports authorized. This percentage would be divided as follows:
- 10 percent to the federal government
- 10 percent to the state government
- 5 percent to the municipal government
In addition, the municipal government of Ensenada would be paid the taxes due to operating in this locality.
By 1930, the stock market crash had given way to the Great Depression, resulting in the bubble burst for the investors of the Playa Ensenada. As a result, the hotel could not draw large crowds of tourists to Ensenada, nor could they get much press attention, unlike Agua Caliente. It is said of the Playa Ensenada enterprise that “Jack Dempsey and Gene Normile backed by way of seeking to outdo the famous Caliente hotel [was a failure because] after a lavish opening to eclipse all openings, the crowds failed to come over the sometimes-labyrinthime old road and Dempsey and Normile gave up the ghost within the first year,” according to sandiegohistory.org.