It was originally built as a home in the 1930's by a cowboy turned artist named Alonzo Megargee. He had fallen in love with Paradise Valley, and decided part of it would make the ideal location for his home and studio. He built his home by himself and called it Casa Hermosa meaning beautiful house. To help him gain income he began to run his home as a guest house, but by 1941 in desperate need of money he was forced to sell his home along with some of his furniture and artwork. Today it has been fully restored and continues to run as a guest house.

Alonzo is believed to haunt his former home, and the tall stetson wearing former cowboy is known to often appear in front of guests, it has also been thought he is responsible for the flushing of toilets and the breaking of drink bottles.