Advertisement
YOU ARE HERE: LAT HomeCollections

Travelers in the Del

New York Firm Plans to Expand Landmark Resort

September 13, 1996|CHRIS KRAUL | TIMES STAFF WRITER

The Hotel del Coronado, one of the nation's most famous and history-rich resort hotels, was sold Thursday by its longtime owners to the Travelers Group of New York, which promised to proceed with plans for expanding the dramatic ocean-side property.

The 108-year-old "Del"--host to 14 presidents and reputedly the place where the prince of Wales met Wallis Warfield Simpson--was sold by the trust formerly controlled by the late M. Larry Lawrence, real estate tycoon and Democratic Party bigwig who was U.S. ambassador to Switzerland when he died in January.

His widow, Shelia Davis Lawrence, said Thursday that negotiations to sell the 691-room landmark to Travelers began before her husband's death. Lawrence bought it in 1963 from John Alessio and spent millions rehabilitating it before it was made a national landmark in 1977. It was built in 1888 and sits on 30 acres of waterfront property in this municipality across the bay from San Diego.

Terms of the sale were not announced, although provisions of a $205-million loan made to Lawrence in 1987 by Primerica--which later became Travelers Group--reportedly gave the lender an option to acquire the hotel. The hotel and its shorefront property have an assessed value of only $114 million, according to San Diego County tax rolls.

Although she refused to comment on the reported purchase option, Lawrence's widow said Thursday that she had not offered the hotel to any other potential buyers. Industry experts who asked not to be identified said Travelers may resell the property, and Walt Disney Co. has long been rumored as a possible buyer.

A hotel spokeswoman denied the Disney report, and a Disney spokesman said it is not the company's policy to comment on rumors. At Thursday's announcement, Travelers Senior Vice President George Ross said the company planned to continue operating the property as an independent hotel and to push ahead for expansion, including 250 rooms, a 25,000-square-foot conference center and more retail space.

"We are just absolutely delighted, fantastic to be owner of this unique and very successful hotel," Ross said.

The Victorian-style hotel with its turreted, red-gabled roof has been used as a set for numerous movies, including the 1959 classic, "Some Like It Hot" starring Marilyn Monroe, Tony Curtis and Jack Lemmon. Presidents Nixon and Reagan hosted state dinners for visiting Mexican presidents Gustavo Diaz Ordaz and Miguel de la Madrid at the site.

The hotel has one of the first Otis elevators ever made, which is still in operation, and its original electrical system was installed under the supervision of Thomas Edison. The ornate interior was fashioned with mahogany from Central America and redwood from Humboldt County.

Legend has it that the prince of Wales--later King Edward VIII--met Wallis Warfield Simpson in a receiving line in 1920 in what was later dubbed the Crown Room, the beginning of their fabled romance that led to his abdication of the British throne. The hotel may have inspired author and frequent guest L. Frank Baum's conception of the Emerald City in his "Oz" books. "It's a classic. When you talk about the Del, you're talking about a property in the same league as the Broadmoor in Colorado Springs [Colo.], the Greenbrier resort in West Virginia," said hotel consultant Bruce Goodwin of San Diego.

Travelers said it will minimize the changes in management resulting from the shift from family to corporate ownership. Travelers, which also owns the Westin Hotel in Santa Clara, Calif., and Canal Place in New Orleans, said it will retain all current top managers and there will be no layoffs among the 1,300 employees.

Lawrence, who got rich building houses in Arizona, had already put in motion the expansion plans, arousing intense opposition in Coronado, a wealthy bedroom community populated by many military retirees and where the average house sells for more than $400,000. The contentious Lawrence had floated the plans for years but had always pulled back, partly because of neighbors' resistance.

A high-powered Democratic fund-raiser, Lawrence and his wife lent his oceanfront house to President Clinton for a family vacation in 1993.

Coronado community development director Tony Pena said Thursday that the hotel owners have not come forward with a comprehensive development plan, although environmental studies on the site have begun. It could take two years for approvals once it is submitted, "depending on the level of controversy generated by the plan," Pena said.

Travelers, which reported $16.6 billion in revenue last year, is a holding company that also owns the Smith Barney investment firm, Travelers Life & Annuity, Commercial Credit consumer finance company and Travelers/Aetna Property Casualty Corp. A spokeswoman could not quantify the company's hotel properties or rooms, but said it owns $5 billion worth of hotels.

The hotel is being sold at a time when San Diego's hospitality market is the strongest in five years, boosted by this summer's Republican National Convention. Hotel revenues in the city are up 8% from last year at this time.

"The economy is improving and there has been an increase in demand and no increase in hotel room supply for the last couple of years. We're finally coming out of the hotel oversupply situation of the 1980s," said Jerry Morrison, a La Jolla hotel consultant.

The occupancy rate at the Hotel del Coronado--where rooms range from $179 to $349 a night--averages in the "mid-80s," General Manager Dean Nelson said Thursday, exceptionally high for the hotel industry.

Advertisement
Los Angeles Times Articles
|
|
|