How Beny Alagem’s vision for a Beverly Hills condo became his white whale

The investor has spent a decade and millions trying to build his Waldorf complex

Feb.February 26, 2018 10:00 AM
Beny Alagem and a rendering of the Waldorf Astoria Residences (rendering via the Beverly Hills Courier)

This is the story of a Beverly Hills developer who got what he wanted from the city a long time ago, then changed his mind and wanted more.

Beny Alagem has spent millions of dollars to try and build a Waldorf Astoria hotel and a pair of condo towers called the Waldorf Astoria Residences on the property of his Beverly Hilton. When the Council first approved his $500 million development proposal in May 2008, George W. Bush was still president and the global economic meltdown was just a few months away.

The Council’s vote followed more than a dozen hearings and an expensive campaign by the developer to persuade voters to support the plan. One of the towers, at 18 stories, would tower over any other building in Beverly Hills. But neighborhood groups who objected to its size and scope gathered enough signatures to force a ballot initiative. In the end, Alagem prevailed, and “Measure H” barely passed.

Today, the Israeli-born hotelier and founder of the Packard Bell computing company has managed to complete one of the three projects, the Waldorf Astoria Beverly Hills. That 12-story, 170-room luxury hotel at 9850 Wilshire Boulevard opened in June. The Waldorf Astoria Residences still exists only on paper, thwarted by the economic recession, a powerful antagonist, and opponents say, Alagem’s hubris and constantly evolving vision.

In early 2016, Alagem decided to restart the project, but with a big change. He would now combine the two buildings — one had been planned for eight stories, the other 18 — into a single 26-story tower. It would loom even larger over Santa Monica Boulevard, at 375 feet.

In place of one of the towers, Alagem planned to create a 1.7-acre public garden along Merv Griffin Way, as perhaps an olive branch to local opponents of the development.

He skipped the city’s land use approval process, opting to put the decision to voters. He gathered enough signatures for a ballot initiative, and in the November 2016 presidential election, voters also decided on “Measure HH.” Alagem again poured his own money — nearly $7 million, or $1,600 per vote — into trying to convince residents that the new plan was better than the old one they had already approved. Some of the money went to a Washington, D.C., research firm, social media marketing, attorneys fees, a public relations firm and a children’s party service.

This time, Alagem lost.

At least some of the credit for that defeat could be attributed to a different developer with its own large-scale construction plans for Beverly Hills.

China-based Dalian Wanda Group proposed One Beverly Hills, a $1.2 billion condo and hotel project next door to Alagem’s complex. Its development partner, Athens Group of Texas, spent $2 million to fight Alagem’s proposal. The duo even commissioned an unflattering rendering of Alagem’s tower that made it seem even more out of scale with the surrounding community.

But in November, the Wanda team put its One Beverly Hills project up for sale, and a legal issue it had with the Waldorf project has been resolved.

One of the most outspoken critics of Alagem’s project has been John Mirisch, a Beverly Hills native and a councilman who has also served as mayor. Mirisch says Alagem’s latest proposal isn’t much different from the one voters soundly rejected in 2016.

“I don’t think he can keep resubmitting the same project and expect different results,” Mirisch said. “The system isn’t supposed to work like that.”

Mirisch supported the Wanda-Athena plan in 2016 when he was mayor — the Council also approved it — a decision for which he has been criticized. He negotiated a more lucrative deal for the city from Wanda, which agreed to pay Beverly Hills added millions in upfront fees. Mirisch has said that unlike Alagem, Wanda followed procedures and its plan did not exceed its property footprint.

Alagem, who declined to comment for this story, has not given up. In January, he returned to the Council with another version, this time intent on following the city approval process. His newest design has shaved off three floors, making the tower 23 stories, but has added 30 more condo units. The units were smaller than had been submitted in the previous plan.

On Tuesday, the city approved plans for an environmental review of the proposed development grounds, an initial process required before any construction can begin. That process typically takes six to eight months, after which Alagem can present the results to the Council for review.

His proposal still faces an uncertain future.

The original development agreement with the city expired in 2017, and Alagem can apply for five one-year extensions. The first two each cost $250,000. The city is processing his second this year. His next two extensions would cost him half a million dollars each, and in the final extension, in 2021, he would have to shell out $750,000.

Alagem still has plenty of supporters in Beverly Hills, including Les Bronte, another former mayor. Bronte, who now runs a volunteer CPR training program for the city, says Alagem’s philanthropic endeavors have earned him high praise around the city. Some of the organizations he’s donated to include Cedars-Sinai Medical Center in Beverly Grove and the Israeli-American Council in L.A.

Bronte said Alagem now intends to work with the Beverly Hills Council to pass his latest plan, and is still committed to seeing the condo tower built.

“I asked him, ‘what happens if you don’t get it?’ Bronte said of the Waldorf project.” Alagem’s answer? “‘I will continue with the city process.’”

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