Sales of Los Angeles hotels are brisk
With the hospitality business in recovery and some financially troubled properties coming to market, sales of hotels in Los Angeles County have increased dramatically in 2011, a real estate brokerage said.
Investors have spent $550 million so far this year on such properties as the Kyoto Grand Hotel and Gardens in downtown Los Angeles and the Sheraton Universal Hotel Los Angeles in Universal City, a 77% increase from the same 10-month period in 2010, real estate brokerage Jones Lang LaSalle said in a report.
Los Angeles is one of the largest tourism markets in the country and second to New York as the top-ranked destination for overseas visitors, the report said. Historically, Los Angeles’ most well-known attractions have been Hollywood studios, Santa Monica beaches and Beverly Hills shopping. However, downtown Los Angeles has come into its own following a decadelong renaissance.
“The revitalization of the downtown Los Angeles market, along with an increased volume of international and overnight visitors continues to be a key driver for the economy,” said John Strauss, a managing director at Jones Lang.
Downtown Los Angeles is seeing a flood of foreign and domestic investment in major development projects. Korean Air plans to demolish the 896-room Wilshire Grand Hotel north of Staples Center and replace it with a $1-billion mixed-use complex with office, retail and residential components, along with a luxury hotel. The existing hotel is slated to close at the end of the year.
Also planned downtown near L.A. Live is a 22-story hotel to be operated as both a Residence Inn by Marriott and a Courtyard by Marriott starting in 2014. Other hotel brands and developers are shopping for sites to build new inns, real estate brokers said.
Los Angeles is projected to host more overnight visitors this year than it has in a decade — an increase bolstered by strong international tourism specifically from Australia, Britain and Japan. International visitors represent one-fifth of the city’s tourist arrivals and generate more than one-third of tourist spending. The number of foreign visitors last year increased 18%, providing a boost to the Los Angeles hotel market.
Revenue produced by L.A. County hotel rooms is expected to continue to increase next year, the report said, but sales probably will be down because the number of properties available for purchase will diminish.
-- Roger Vincent
Photo: L.A. Live in downtown Los Angeles. Credit: US Presswire