L.A. Hotel Gets New Partner
By Margo McCall -- Tradeshow Week, 1/23/2006
LOS ANGELES— Residential developer KB Home has stepped in to build the long-awaited headquarters hotel next to the Los Angeles Convention Center.
Under a partnership with AEG, developer of the $4.5 billion L.A. Live entertainment district, KB Home will develop a $600 million hotel with 1,100 rooms, including 250 luxury condominiums and 200 luxury rooms. The 50-story hotel tower, which will also feature 70,000 square feet of meeting space, is slated for completion by mid-2009.
KB Home replaces Apollo Real Estate Advisers and Wolff Urban Management, which have withdrawn their plans for a $300 million, 55-story hotel with 900 rooms, including 100 condos and 300 luxury units. Lew Wolff, however, will remain an advisor on the project.
"For 20 years, L.A. has been trying to build a headquarters hotel," said Tim Leiweke, president and CEO of AEG, adding that the new partnership means there will be "no more speculation, no more false starts, no more saying it won't happen."
Hilton Hotels had previously signed on to operate the headquarters hotel. With the change of partners, negotiations have reopened and new operators are expected to be finalized in the next month.
Mayor Antonio Villaraigosa, who last year helped resolve a city hotel labor dispute, was pivotal in helping get the headquarters hotel project back on track. "He put his neck out there and helped us resolve the lawsuit surrounding this project," Leiweke said.
Meanwhile, work is continuing on the 4 million sq. ft. entertainment district, which will include restaurants, theaters, retail space, residential units and a museum. Parts of the project, within walking distance of the convention center, are scheduled for completion as early as late 2007.
Besides reinvigorating the city's downtown, the project is aimed at beefing up activity at the convention center. "We're going to give you the ammunition you need to win the war" and make the city "one of the great points of destination for conventions and events," Leiweke told tourism officials in announcing the new partners.
Michael Krouse, vice president of convention sales for L.A. Inc., the Los Angeles Convention & Visitors Bureau, is already feeling the effect. Seven citywide conventions have signed on in the past month alone to visit Los Angeles. That represents half of the city's convention bookings in all of 2004.
"The thing that's exciting about this is that our competitors are telling us that L.A. is really becoming a viable competitor," Krouse said.
Among the recent bookings are the 2011 Life@50 — AARP's Natl. Event & Expo, which is expected to generate 18,000 room nights. Siggraph has been booked for 2008 and 2011, the American Assn. for Cancer Research will hold its meeting there in 2007 and the Assn. for Financial Professionals will meet there in 2008.
The Intl. Reading Assn., whose annual convention generates 28,000 room nights, has signed on for 2015, 2022 and 2026. And ASAE & the Center will hold its annual meeting for association members in Los Angeles in 2010, a year after the headquarters hotel's scheduled completion.
