Standard Hollywood on sales block

Once-trendy 139-key hotel ended 22-year run with permanent shutdown in January

Los Angeles /
Oct.October 11, 2021 12:12 PM
The Standard (Getty)
The Standard (Getty)

The Standard Hotel in West Hollywood has gone from one-time trendsetter for the stars to the sales block, The Real Deal has learned.

“The property is up for sale by the owner of the underlying real estate,” a spokesperson from the hotel operator’s parent company, Standard International, said on Monday. “We are very hopeful to bring the hotel back to life as the Standard” with whoever buys the building.

Rittersbacher Sunset LLC has owned the land under the hotel at 8300 Sunset Boulevard since 1989, records show. The LLC is linked to Randy Garitty of Oregon.

The 139-key hotel caused a stir on the celebrity scene in Los Angeles when Andre Balazs opened the property in 1999. It had operated as part of Standard International ever since, with Balazs no longer affiliated with the company and the lease on the building is in the hands of Ferrado Group.

Ferrado Group was a middle-man in the structure, leasing the building from landowner Rittersbacher Sunset and, in turn, collecting rent from Standard International.

The structure began to fracture when the Standard Hollywood shut down in January. The move came after Rittersbacher Sunset exercised an option to raise the rent on the operator in 2019.

The increase “rendered it unsustainable to operate the hotel,” a spokesperson for Standard International said at the time.

Ferrado apparently sought to avoid passing along the big hike in costs to Standard International by suing Rittersbacher Sunset in July 2020, claiming the latter unfairly raised the rent due to an “erroneous appraisal method,” according to court documents. Rittersbacher claimed the property was valued at around $61 million — 12 times the value used in rent calculations at the time, bringing annual rent to $4.9 million, Ferrado said.

“Rittersbacher’s demands to increase the rent unilaterally due to its incorrect appraisal threatens to result in the forfeiture of a large hotel, as well as financing, cashflow, and renovation costs that could reach into the tens of millions of dollars,” Ferrado said in its complaint.

Rittersbacher Sunset denied Ferrado’s allegation, adding it has “not charged an illegal rent,” but “simply asserted its position as to what the proper amount of rent should be.”

Ferrado and Rittersbacher settled the suit in June, court documents show. Settlement terms were not disclosed, but a spokesperson for Standard International said Ferrado is
“no longer involved.”

Neither Ferrado nor Rittersbacher responded to requests for comment.

Hotel sales in Los Angeles have skyrocketed since the start of the pandemic. Across the county, 48 hotels changed hands in the first half of 2021. The 580-key Hyatt Regency at LAX and the 175-key Le Merigot hotel in Santa Monica both changed hands for $75 million — the most expensive hotel sales in Los Angeles this year.





    Related Articles

    arrow_forward_ios
    Ruixue “Serena” Shi and City of Coachella (Getty)
    Developer sentenced to 20 years in prison for Coachella hotel scheme
    Developer sentenced to 20 years in prison for Coachella hotel scheme
    Morgan Brown and 948 North Orlando Avenue (Getty, 948 North Orlando Avenue via Todd Goodman)
    WeHo compound breaks neighborhood record
    WeHo compound breaks neighborhood record
    Ed Scheetz, Ian Schrager and former Standard Hollywood (LInkedin, Ian Schrager, Getty)
    Billboard spat holds up purchase of Standard Hollywood site
    Billboard spat holds up purchase of Standard Hollywood site
    From left: Warren Wachsberger, Mike Leipart, and James Harris with The Pendry Residences
    The Agency steps into sales at The Pendry Residences WeHo
    The Agency steps into sales at The Pendry Residences WeHo
    GPI Companies’ Alexander Akhtarzad  and Josh Flagg with a rendering of Nine Thousand One (GPI, Getty)
    Nine Thousand One joins Westside’s upscale apartment market
    Nine Thousand One joins Westside’s upscale apartment market
    A.J. Khair's Demitri Samaha and renderings for 8240 Sunset Blvd (A.J. Khair, Getty)
    A.J. Khair eyes West Hollywood for hotel-housing complex
    A.J. Khair eyes West Hollywood for hotel-housing complex
    Hudson Pacific Properties Victor Coleman and Art of Quixote studios (Hudson Pacific Properties)
    Hudson Pacific Acquires Quixote Studios for $360M
    Hudson Pacific Acquires Quixote Studios for $360M
    The Wing's Fatima Koning and the Wing West Hollywood, 8550 Santa Monica Blvd (The Org, The Wing, Getty)
    Co-working operator The Wing goes out of business
    Co-working operator The Wing goes out of business
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...