The celebrated Ambassador Hotel, aging none too gracefully in its 66th year, has a new suitor--the Los Angeles Unified School District.
Meeting in a closed-door session late Monday, the Los Angeles school board decided to explore the possibility of purchasing the Ambassador, razing most of the buildings and erecting a high school on the 23.5-acre grounds.
Douglas Brown, the district's deputy business manager, said the district will contact the hotel's owners to find out how much the property would cost and then will seek an independent appraisal and an environmental impact report.
Brown said the district will propose that a small portion of the property--about three acres fronting on Wilshire Boulevard--be used for commercial development. The district would share in the profits from such a joint venture, he said.
Richard Volpert, attorney for the J. Myer Schine family, which owns the Ambassador, said Monday night that he was unaware of the school district's interest. He said negotiations are under way with three potential buyers, with a price range of $65 million to $70 million. He said two of the buyers would demolish the entire hotel and that one has expressed interest in preserving parts of it.
What the district proposes to do with the remainder of the property, including the fabled Coconut Grove nightclub, could certainly trigger controversy. Heritage-minded Angelenos have made preserving the landmark hotel a priority in their agenda.
Need for High School
The Ambassador site is attractive to the district because it needs to build a new high school in that area but has been unable to find a large enough site. Using the Ambassador site would allow the district to escape the painful--and controversial--process of demolishing existing houses and apartments and relocating the residents in order to make way for construction of a new campus.
The district expects 10,000 to 14,000 new students a year for the next several years and is engaged in an intensive school building program. A new high school in the Ambassador area would relieve crowding at Belmont and Los Angeles high schools, which currently bus hundreds of students to other campuses.
"This would give us the opportunity to build a senior high school in a severely impacted area without displacing hundreds and hundreds of people," Brown said. "This property is unique in its size and its location. It is sited in an areas where the (school) overcrowding is occurring."
No Purchase Commitment
Board member Jackie Goldberg proposed that the district consider buying the hotel. "It is something I've been interested in for a long time. I know it's going to be expensive. But it's also expensive to relocate people."
Goldberg stressed that the board has made no commitment to buy the property. "This is in the very earliest of stages. . . . We're only exploring it."
The district said it costs about $50 million to build a new high school, including the cost of purchasing the land. The storied Ambassador--where Hollywood's biggest stars danced away the Depression, where Marion Davies once pranced through the lobby on horseback to amuse William Randolph Hearst, and where Sirhan Sirhan assassinated Robert F. Kennedy in 1968--has been a money loser for several years. In May, the hotel closed nearly three-fourths of its 500 guest rooms after failing to meet fire standards and learning that more than $1 million would be needed to reinforce the upper floors against possible earthquake damage.
The hotel, held in a Schine family trust, has been up for sale for three years as part of a concerted effort to liquidate its hotel and theater empire. Business Week magazine in 1986 estimated the family's holdings to be worth about $1.5 billion.
Demolition-minded developers have coveted the prime Wilshire corridor real estate--efforts resisted by preservationists such as the Los Angeles Conservancy.
Councilman Nate Holden, whose district includes the hotel, has also taken a special interest in the issue. He endorsed an unprecedented private agreement earlier this year between the Schine family and the preservationist Los Angeles Conservancy concerning the disposition of the property.
Under that pact, the owners have agreed not to pursue demolition for up to a year and to cooperate with the Conservancy in efforts to sell the property to a buyer who would restore the hotel. Moreover, the Schine family agreed not to demolish the hotel until a development plan receives City Council approval.
Since then, attorney Volpert said, the Conservancy has solicited five offers for the hotel but none were "solid."
Ironically, the unusual agreement prompted the City Council in August to vote against a motion declaring the Ambassador a historic monument. Holden convinced the council that the private agreement provided stronger protection than the city could provide.
Under city laws, historic-monument status provides up to a one-year moratorium on the issuance of a demolition permit. The councilman said he was fearful that the owners would begin demolition proceedings after the one-year moratorium elapsed, leaving an empty lot in its place.
At the time, Volpert argued against the historic-monument declaration. "We don't agree with the argument it is architecturally significant or should be preserved," he said.
Two weeks after the council meeting, a group of San Francisco-area investors offered close to $50 million for the Ambassador, but did not receive a favorable response from the family. Estimates of the hotel's worth have ranged from $50 million to $100 million.