"As Pebblebrook Hotel Trust chairman and chief executive Jon Bortz previously told The Real Deal, L.A. is a difficult market to sell in today due to unfriendly government policies and the lagging impact from the fires, strikes, ICE, National Guard. The City of Los Angeles has its share of the regionwide challenges of homelessness and a specific $30 minimum wage for hotel workers and property transfer tax that seems to have investors looking to neighboring municipalities for deals."
"Corten Real Estate Partners purchased The Line in Koreatown for $68 million. The 384-key hotel was developed in 2014 by an entity connected to billionaire investor Ron Burkle and his Yucaipa Companies. Yucaipa secured a $100 million loan from Corten but later defaulted then the lender made the buy. The distressed deal came out to $177,000 a room. No transfer taxes were paid due to the change of title via foreclosure."
"Pebblebrook Hotel Trust sold the 133-key Montrose hotel in West Hollywood for roughly $44 million. The boutique hotel, near Sunset Boulevard, traded for about $333,000 a room. The company did not disclose the buyer at the time of sale, but a person familiar said it is a high-net-worth individual who has roots in Los Angeles, believes in its future and shops bargains in distressed markets. We now know that is Daniel Negari, founder and chief executive of XYZ, according to property records."
Los Angeles is a difficult market to sell in due to unfriendly government policies, lingering effects from fires and strikes, immigration enforcement activity, and National Guard deployments. The city faces regionwide homelessness and a $30 minimum wage for hotel workers plus a property transfer tax (Measure ULA) that has pushed investors toward neighboring municipalities. Los Angeles County’s top 2025 hotel sales include Corten Real Estate Partners’ purchase of The Line at 3515 Wilshire Boulevard for $68 million out of foreclosure, a distressed $177,000-per-room deal; and Pebblebrook’s sale of the 133-key Montrose in West Hollywood for roughly $44 million.
Read at therealdeal.com
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