In the second sale of a Southland hotel to Korean investors in less than a week, Seoul-based Koreana Hotel Co. has purchased the Hyatt Wilshire Hotel for about $25 million in cash, according to sources close to the deal.
The purchase of the 396-room hotel from Hyatt Corp. came after Korean-born investor Charles Lee paid $18.1 million at an auction last Thursday for the 150-room Doubletree Resort in Cathedral City near Palm Springs. The latest deal raises the number of Korean-owned hotels in Southern California to three, including the Hilton Hotel in downtown Los Angeles.
The purchases have stirred hopes among some analysts that foreign investment will help shore up Southern California's weak hotel market, which has been undergoing a brutal shakeout because of excess hotel rooms, the recession and a drop in travel.
The Hyatt Wilshire is "a very logical acquisition for them" because it's located near Los Angeles' Koreatown, said Donald W. Wise, a senior associate with the hotel/hospitality properties group of CB Commercial Real Estate Group Inc. "I don't know if it establishes a trend, but it is a very positive development. In this environment, we've seen properties selling around $40,000 to $50,000 a room," compared to the $63,000 per room paid for the Hyatt.
A spokesman for Chicago-based Hyatt Corp. could not be reached for comment. Koreana's lawyer, Daniel W. Lee in the Los Angeles office of Whitman & Ransom, would not comment on the estimated purchase price.
Lee said Koreana, headed by Yong Hoon Bang, who owns three hotels in Korea, will rename the facility after completing the acquisition this year. He said the company also plans to spend several million dollars renovating the hotel, located at 3515 Wilshire Blvd.