Another Hotel Proposed For Downtown
Los Angeles Downtown News
By Nicholas Slayton
November 23, 2016
This month, a consortium of developers backed by Chinese money filed plans with the city to build an 18-story, 247-room hotel near L.A. Live. The establishment would be branded a Cambria Hotel, and would be pitched to business travelers and have lower rates than other nearby properties.
The team of Sun Holdings DTLA, Choice Hotels, developer Barry Beitler and Pacific Property Partners on Nov. 3 filed papers with the Department of City Planning for the Cambria at L.A. Live, which would rise at 926 James M. Wood Blvd., north of the sports and entertainment complex. Chris Atkinson, managing partner with Pacific Property, said the goal is to break ground next summer and open in early 2019.
Renderings from Orange, Calif.-based Architects Orange show a sleek, white building with a rooftop pool, and a style more reminiscent of a beachside project than the glass-and-steel high-rises that dominate Downtown development.
Atkinson said the parties came together in the fall of 2015 when Sun Capital, the investment firm that manages Sun Holdings and whose investors are primarily Chinese, was looking to invest in Downtown. They purchased the 14,156-square-foot parcel in June for $14.5 million, buying it from an investor who had owned the site—currently a parking lot—for a decade.
This marks Sun Capital’s first project with Choice Hotels, which according to a press release has more than 6,400 hotels in 40 countries. Sun Capital CEO Philip Powers said that the location fits with Choice’s mid-market Cambria brand.
A number of upscale hotels in the L.A. Live area are under construction or have been announced. Developer Greenland’s $1 billion Metropolis will have a 350-room Hotel Indigo. The $1 billion Oceanwide Plaza project across from Staples Center will include a luxury Park Hyatt hotel. A W Hotel has been proposed for the Shenzen Hazens project on the site of the Luxe City Center. All three are from Chinese companies.
Atkinson said the Cambria would serve a different market.
“If you’re a business traveler, coming to the Convention Center to be involved with that Downtown marketplace, there’s not a lot of choice, especially affordable choices,” he said.
Steven Marcussen, executive director of real estate firm Cushman & Wakefield, said that demand for a mid-range hotel will increase as the Convention Center gets close to a long-needed renovation. He noted that part of the reason Chinese investors are coming to Downtown Los Angeles is because the Chinese market is saturated.
“They want long-term, solid investments,” Marcussen said. “We see Chinese investors that want to build new projects. And that is the unique thing with these new ones — they buy the land and immediately proceed to build.”
The sentiment was echoed by Wei Chen, the chairman of Sun Capital, which represents Chinese investors. Chen told Los Angeles Downtown News that investors have observed the local shortage of hotels and the Downtown development boom, and are trying to seize the opportunity.
The Cambria Hotel differs from other Chinese-funded projects by virtue of its local partners. Powers said Sun Capital will benefit from the experience of Beitler and Pacific Property Partners.
“It represents a departure from some of the main Chinese investor groups like Greenland who try to do it themselves,” Powers said. “Our approach is to marry Chinese capital with partners we know well. It reduces the risk of the project.”
Sun Capital is currently working on luxury housing developments in Brentwood. Pacific Property Partners has projects in the city, but so far none in Downtown.
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