Lux­ury ho­tel sought in Bev­erly Hills

De­vel­op­ers pro­pose build­ing fewer con­dos in planned com­plex to make way for ad­di­tion.

Los Angeles Times - - BUSINESS - By Roger Vin­cent

The Chi­nese own­ers of a for­mer depart­ment store site in Bev­erly Hills — long con­sid­ered one of the re­gion’s most de­sir­able de­vel­op­ment lo­ca­tions — are propos­ing to add a top- of- the­line ho­tel in their planned $ 1bil­lion con­do­minium com­plex.

Wanda Group, which bought the prop­erty at 9900 Wil­shire Blvd. last year, said Wed­nes­day that it planned to re­duce the num­ber of con­dos in the de­vel­op­ment, de­signed by Getty Cen­ter ar­chi­tect Richard Meier, to make way for a lux­ury ho­tel.

Bev­erly Hills is one of the top U. S. ho­tel mar­kets and could ab­sorb a new lux­ury en­trant with­out dif­fi­culty, hos­pi­tal­ity con­sul­tant Bruce Baltin of PKF Con­sult­ing said.

The lux­ury ho­tel mar­ket suf­fered badly in the last eco­nomic down­turn, but room rates have since risen to all- time highs, Baltin said.

Los An­ge­les “is get­ting to be more of a world city and get­ting more in­ter­na­tional busi­ness,” he said. “Our rates are rea­son­able com­pared to the rest of the world.”

Top ho­tels in Bev­erly Hills were nearly 80% oc­cu­pied last year and charged guests an av­er­age of $ 453 a night, ac­cord­ing to PKF. Baltin pre­dicts that by the end of this year the av­er­age daily rate will rise to $ 480, a num­ber un­likely to make well- heeled trav­el­ers balk.

Five- star prop­er­ties in the area in­clude the Penin­sula Bev­erly Hills, the Mon­tage Bev­erly Hills, the Bev­erly Hills Ho­tel and the Ho­tel Bel- Air.

The planned de­vel­op­ment, now called One Bev­erly Hills, is next door to the ven­er­a­ble Bev­erly Hil­ton Ho­tel and a new Wal­dorf As­to­ria ho­tel un­der con­struc­tion at the in­ter­sec­tion of Wil­shire and Santa Mon­ica boule­vards. The Wanda ho­tel would be on the south side of One Bev­erly Hills fac­ing Santa Mon­ica Boule­vard.

The 134- room ho­tel would be op­er­ated by Wanda Group, which is China’s largest com­mer­cial prop­erty devel­oper and the owner of the AMC theater chain. Wanda al­ready op­er­ates 71 ho­tels, al­most ex­clu­sively in China.

Condo de­vel­op­ment at 9900 Wil­shire was ap­proved by the city a decade ago, but the pro­posal to in­clude a ho­tel in the pro­ject will re­quire the de­vel­op­ers to go be­fore city of­fi­cials again. The de­vel­op­ers hope to se­cure per­mis­sion for the al­tered pro­ject within 18 months and be­gin build­ing it in early 2017. Con­struc­tion would take at least two years.

Wanda Group and part­ner Athens Group, which de­vel­oped the Mon­tage Bev­erly Hills ho­tel and con­dos, hope that city lead­ers will be per­suaded in part by the prospect of ad­di­tional public rev­enue from taxes the city charges ho­tel guests. The de­vel­op­ers es­ti­mate that by elim­i­nat­ing 42 res­i­dences from the plan and in­sert­ing a 134- room ho­tel in the same space, the an­nual tax rev­enue gen­erat- ed from the com­plex for the city would rise $ 4.2 mil­lion to $ 6.9 mil­lion.

One Bev­erly Hills would have 193 res­i­dences. The height and den­sity of the pro­ject would not change from the ap­proved de­sign. A small col­lec­tion of shops, how­ever, would be elim­i­nated, and the ca­pac­ity of the un­der­ground garage would be in­creased from 802 park­ing spa­ces to 1,083 spa­ces.

The ho­tel would have a spa and a rooftop pool avail­able only to res­i­dents and ho­tel guests. It would also have restau­rants open to the public on the rooftop and ground level. There would be three- fourths of an acre of public gar­dens ac­ces­si­ble from Wil­shire Boule­vard and Merv Grif­fin Way.

The eight- acre site was once home to a Robin­son­sMay depart­ment store, which has been de­mol­ished and leaves a gap in a block that could be con­sid­ered the western gate­way to Bev­erly Hills, said David Shu, gen­eral man­ager of Wanda Bev­erly Hills Prop­er­ties, a sub­sidiary of Wanda Group.

The com­pany hopes to be­come the world’s largest op­er­a­tor of lux­ury ho­tels.

Wanda was founded in 1988 by Chi­nese bil­lion­aire Wang Jian­lin and op­er­ates lux­ury ho­tels, com­mer­cial prop­er­ties and depart­ment stores. The com­pany is ac­tive in en­ter­tain­ment, tourism and e- com­merce. It went public in 2014 and re­ported as­sets to­tal­ing $ 85.6 bil­lion and an­nual in­come of $ 38.8 bil­lion.

A Wanda ho­tel will be in­cluded in com­mer­cial de­vel­op­ments the com­pany has un­der­way in Chicago, Lon­don and Madrid, as well as the Aus­tralian mar­kets of Syd­ney and the Gold Coast south of Bris­bane.

Wanda bought 9900 Wil­shire for $ 420 mil­lion last year from a group of in­vestors led by Hong Kong pri­vate eq­uity real es­tate f irm Joint Trea­sure In­ter­na­tional. Joint Trea­sure bought the prop­erty for $ 148 mil­lion in 2010 and an­nounced that it would build con­dos un­der the ap­proved plan. An of­fer from Wanda to buy the prop­erty was too good for Joint Trea­sure to pass up, how­ever.

For Wanda, the sig­nif­i­cance of the de­vel­op­ment ex­tends be­yond real es­tate. The com­pany said last year that the pro­ject at 9900 Wil­shire Blvd. would serve as its “f irst im­por­tant step into Hol­ly­wood.”

The de­vel­op­ment “is ex­pected to aid China’s en­try into Hol­ly­wood’s film in­dus­try and gen­er­ally pro­mote Chi­nese cul­ture abroad,” Wanda said at the time of the pur­chase.

The com­pany is build­ing what it says will be the world’s largest film and tele­vi­sion stu­dio on nearly 500 acres in Qing­dao, China. It is set for com­ple­tion in 2017.

L. A. ho­tel ‘ rates are rea­son­able com­pared to the rest of the world.’

— Bruce Baltin, hos­pi­tal­ity con­sul­tant at PKF Con­sult­ing

Wanda Group

DE­VEL­OP­ERS of a planned condo com­plex in Bev­erly Hills hope to se­cure per­mis­sion for the al­tered pro­ject within 18 months and be­gin build­ing it in early 2017.

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