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Los Angeles

Here are the biggest LA hotel sales of 2019

Ace Hotel purchase highlights relatively modest year

The sale of the Ace Hotel was the biggest L.A. County hotel buy in 2019 (Credit: Google Maps)
The Ace Hotel, at right, was sold in November for $117 million. (Credit: Google Maps)

The upper-echelon of hotel sales in Los Angeles this year were more modest than in 2018 when two DoubleTree by Hilton hotels sold for at least $150 million.

That is, until this week, when the 201-key Montage Beverly Hills hotel was sold to Qatar-backed Maybourne Hotel Group. Financial terms were not disclosed but the deal values the exclusive hotel at over $400 million, which would easily make it the priciest hotel sale in L.A. this year. 

Before that, the splashiest hotel transactions of 2019 was the 92-year-old Ace Hotel in downtown, which actually changed hands twice during the year.

Another notable development was that Blackstone Group unloaded two of the properties in The Real Deal’s ranking of the top five hotel sales of 2019, selling both properties to regional hotel investors.

Here are the top five hotel sales in Los Angeles County during 2019 based on TRD research and news clippings:

Ace Hotel and Theater | unknown buyer | $117 million

Park Hotels & Resorts Inc. bought the downtown Los Angeles Ace hotel in September as part of its $2.5 billion acquisition of Chesapeake Lodging Trust. The deal included hotels throughout the U.S. including San Francisco, Boston, Denver, and Miami.

The dominos from the acquisition started falling in November when Park Hotels sold its L.A. hotel from the merger — the iconic Ace hotel — to an unidentified buyer. The buy- and sell-side brokers were not identified.

The Ace, designed by architects Albert Walker and Percy Eisen, was built in 1927 to host the United Artists film studio. The property has gone through four buyers in the last eight years with Christian Center Inc. and Greenfield Partners previously owning the property. Once the broadcasting site of televangelist Gene Scott, the Ace has transformed in the last five years as a hub for music and the arts in downtown.

Residence Inns Hotels | Positive Investments| $103.5 million

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A local property management outfit, Arcadia-based Positive Investments Inc., bought a trio of Residence Inn hotels from the Blackstone Group. The hotels are located at 321 E. Huntington Dr. in Arcadia, 4111 E. Willow Dr. in Long Beach, and 700 Ellinwood Way in Pleasant Hill.

Los Angeles-headquartered brokerage giant CBRE Group represented the buyer and the seller in the sale. The hotels total 462 rooms. Residence Inn is part of the chain of hotels operated by global hotelier Marriott International Inc.

Hotel Amarano | Nimes Capital | $73 million

The self-described “only luxury boutique hotel in Burbank” changed hands in June, with Century City-headquartered private investment firm Nimes Capital acquiring the inn from Pebblebrook Hotel Trust, a West Bethesda, Maryland-headquartered hotel investment firm. Nimes is an arm of David Nazarian’s Nazarian Enterprises.

JLL represented both the buyer and seller of the 132-room hotel.

Freehand Los Angeles | Queensgate Investments | $49 million

London-headquartered investment group Queensgate scooped up the downtown hotel in October from the ownership consortium of Sydell Group and investor Ron Burkle. A buying and sales agent were not listed.

Like the Ace Hotel, the 226-room Freehand is part of a fast-developing area of Los Angeles where new bars, restaurants, and retail are continually opening. Unlike the Ace, the Freehand is a budget hotel. Its original owner, Sydell Group chief executive Andrew Zobler, has said that he wants the hotel to capture the culture of a hostel without being one.

The overall Freehand portfolio – which includes properties in Chicago, New York Miami – traded for $400 million. Queensgate plans to operate the company alongside its Generator brand, which manages hotels and hostels in Europe.

Hyatt Place Los Angeles, Los Angeles Airports | Washington Real Estate Holdings | $44.5 million

The Hyatt Regency in El Segundo, which abuts LAX, sold in February by Blackstone Group to Washington Real Estate Holdings, a Seattle-based company. Eastdil Secured was sales agent for the 143-room hotel at 750 N. Nash St. Washington Holdings also owns the SLS Beverly Hills and a Residence Inn in Manhattan Beach.

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Blackstone GroupDowntown LAHotels