Downtown Long Beach Hotel Sells

A Marriott-branded hotel on downtown Long Beach’s Ocean Boulevard traded hands for about half its prior price tag.

The Westin, at 333 East Ocean Boulevard and near the water, sold for about $42 million, according to records dated late last month, compared to its sale price of $85 million nine years ago. Rockpoint and Highgate sold the 469-room hotel in the heart of the city’s downtown to Khanna Enterprises, which received a $39 million note for the deal.

That trade comes out to less than $100,000 per key for the high-rise hotel. Los Angeles’ hotel world is in a rut, but that’s still a very low per-key price that may have more to do with an upcoming cost the seller was on the hook for: a property improvement plan. That is basically an action plan designed to bring an individual hotel into compliance with the latest brand standards. An informed industry source said the property improvement plan was around $25 million.

And things were already costly. The sellers completed a $23 million renovation of the hotel with a curved, modern facade, surrounded by palm trees, where a fountain sits at its entrance, two years after purchasing it. In 2024, the Long Beach hotel’s unionized workers went on strike and later negotiated a new contract and a wage increase.

Last year, Los Angeles’ priciest per-key deal was in Malibu (it was one of California’s priciest per-key deals ever, too). Luxury fashion brand Chrome Hearts, owned by Richard and Laurie Stark, purchased the luxe oceanfront Surfrider for $37.5 million from Dauntless Capital Partners. That deal came out to almost $2 million a room, but its pricing was an exception. Still, a West Hollywood hotel deal that had a per-key price reflective of the current market commanded more than the Long Beach trade, at $333,000 per room.

Representatives for Khanna Enterprises, Rockpoint and Highgate did not immediately respond to a request for comment.

Orange County-based and family-owned Khanna Enterprises has made discounted buys before. In 2022, it purchased a Westin in San Jose for about $45 million, or 30 percent less than what the property commanded in 2017. Major players Rockpoint and Highgate have previously partnered on deals via joint ventures.