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Compton

August 04, 1994|EMILY ADAMS

Hotel Will Be Converted to Senior Citizen Home

The Compton Ramada Hotel, once touted as a centerpiece of the city's economic renewal, has been sold to a developer who intends to convert the private rooms into a senior citizens' residence.

A divided City Council agreed to sell the nine-story hotel. According to the agreement, the first four floors of the Ramada will remain as they are: a few hotel rooms, ballrooms, restaurants and a gift shop. The remaining rooms will house ambulatory senior citizens. The project is scheduled to be completed in about 18 months.

Developers agreed to pay $24.4 million for the hotel, at least $10 million below its appraised value. The sale leaves Compton without a major hotel.

The hotel was sold to Cal-State Progressive Development Inc., an Altadena company that filed incorporation papers in June. The company agreed to make a down payment of $3 million and pay the remainder over 10 years.

Three council members approved the sale. Mayor Omar Bradley and Councilman Ronald J. Green, who balked at the plan to give the developer 10 years to pay off the balance of the purchase price, abstained.

"It doesn't work. These people are going to be up and gone long before that note is paid," Bradley complained.

The story of Compton's hotel has followed a twisting plot that included financial indiscretions, city takeovers and low occupancy.

The city originally paid $15 million to developer Naftali Deutsch to build the city-owned convention center and parking facility that are part of the hotel complex. Compton also loaned Deutsch and his Lazben Financial Corp. more than $5 million to complete the hotel, which overlooks the Redondo Beach (91) Freeway. Deutsch never made a payment on the loans.

The city took over management of the hotel within two years of its opening in the fall of 1989 and began foreclosure proceedings. The hotel has suffered low occupancy rates and managerial problems, causing council members to view their former prize as a white elephant.

The hotel has been appraised at $35 million to $40 million, but because of a depressed real estate market, council members--including Bradley and Green--said they were pleased with the sale price.

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