Construction of a 15-story Ritz-Carlton hotel in Marina del Rey has been approved in concept by Los Angeles county officials as part of a proposal to extend a marina lease that is expected to generate $1.4 billion in revenues over 39 years.
The county Department of Beaches and Harbors design control board approved the 308-room, $50-million luxury hotel, stipulating that Ritz-Carlton provide a traffic impact study and increase parking for boaters at the site, at Admiralty Way and Via Regata near the edge of the marina's northern basin.
Marina del Rey Properties Ltd., which leases 37 acres of marina property from the county and is in partnership with Hughes Aircraft Corp., wants to sublease seven acres to Atlanta-based Ritz-Carlton to build the luxury hotel.
Marina del Rey Properties pays the county about $1 million a year from its leases on 600 units in three residential towers, 100 units in a low-rise apartment house, two restaurants and 340 boat slips.
The firm has 42 years left on its 60-year lease with the county, which collects 7.5% of Marina del Rey Property's residential rent income, 3% of the restaurants' gross income and 20% of the lease income from the boat slips.
The company has been negotiating with county officials since February, 1985, to extend its lease by 39 years so it can finance construction of the hotel project, according to Chris Klinger, the county's chief of revenue property for the marina. Klinger said financial institutions have indicated that the extension would enhance the company's loan status.
Marina del Rey Properties also wants the right to sell long-term subleases on its 600 residential units. Under its current lease, the company can sublease units for a year only.
County officials involved in the negotiations said that the county could earn $1.4 billion over the 39 years from the hotel and residential leases.
"I think the county (will get) a good deal out of it," Klinger said.
If the hotel project is approved, the county wants 7.5% of the hotel's gross income. Officials also want Marina del Rey Properties to give the county 20% of the gross proceeds from the sales and resales of the long-term leases.
But to build the project, Ritz-Carlton must obtain a conditional-use permit and a parking permit from the county Department of Regional Planning, said Lawrence Charness, chief of the county planning for the marina.
The county Public Works Department will also have to approve the project. And although the marina's coastal plan allows a hotel at the proposed site, the California Coastal Commission will have to approve the building plans, Charness said.
The county awarded Marina del Rey Properties the lease on the property when the company submitted the winning bid in 1968.
The Ritz-Carlton in Laguna Niguel, which opened in 1984, is the company's only hotel in the Western United States. The company owns all or part of other hotels in New York, Boston, Chicago and Atlanta.
Charness said that Ritz-Carlton may submit its revised plan at the next meeting of the design control board July 17.
If approved, the Ritz-Carlton would edge out the 300-room Marina Beach Hotel as the largest hotel in the marina.