The landmark Ritz-Carlton Huntington Hotel & Spa in Pasadena is being sold for $170 million to a Hong Kong real estate investment firm that may drop the name Ritz-Carlton.
Great Eagle Holdings, which owns office, retail, residential and hotel properties in Hong Kong, North America and Europe, announced the purchase in a statement to the Hong Kong stock exchange Tuesday.
Great Eagle said it would pay cash for the 392-room hotel to two partnerships controlled by the Los Angeles County Employees Retirement Assn., which bought it for $42.5 million in 1994. The sale is contingent on the termination of the management agreement with Ritz-Carlton.
The hotel on 23 acres overlooking San Marino has been a popular destination since 1907. In addition to countless wedding receptions and family celebrations, the Ritz-Carlton has played host to movie stars, politicians and star-studded galas.
In 1992, TV producer Harry Thomason's surprise birthday party guest list included a sax-playing Bill Clinton.
The Huntington was rebuilt after being declared seismically unsafe in 1985 and reopened in 1991 as a Ritz-Carlton. It is the only AAA five-diamond hotel in Pasadena, and room rates start at more than $300 per night. According to the buyer's statement, it earned a profit of more than $10 million last year before taxes and other charges.
Great Eagle, controlled by Hong Kong billionaire Lo Ka-shui, said in the statement that it outbid other investors to get the property as part of a plan to expand its global hotel business. Earlier this month the company agreed to sell an 18-story office building in San Francisco for $142.5 million.
"The market for hotel investment is still extremely hot, even with the credit crunch," said consultant Bruce Baltin of PKF Consulting. "The Huntington is a high-quality asset that would have a lot of people chasing it."
Great Eagle could not be reached and a spokeswoman for Maryland-based Ritz-Carlton Hotel Co. said she didn't yet know how the sale would affect her company's role in Pasadena.
Great Eagle owns Langham Hotels in Boston, London, Hong Kong, New Zealand and Australia. It's likely that Great Eagle would turn the Pasadena property into a Langham, consultant Alan Reay of Atlas Hospitality Group said.
Langham is a luxury brand that dates to 1865, when the Langham Hotel in London opened as Europe's first grand hotel, according to the chain's website.
Careen Friedland, owner of the San Marino Gallery in Pasadena, would hate to see the name change.
"Everyone loves to say they got married at a Ritz-Carlton," she said. "It's like Tiffany. It's a wonderful draw for Pasadena."
The L.A. County Employees Retirement Assn. and Ritz-Carlton have been in an ongoing dispute with the Pasadena hotel's union, Unite Here Local 11.
In August, employees filed a lawsuit alleging that they were not paid overtime and forced to work through breaks. Workers have also filed complaints with the state Department of Fair Employment and Housing and the National Labor Relations Board.
"We hope that the new owner will take proactive steps to resolve the workplace issues and not get in the way of the workers trying to organize a union, but the sale is very disappointing," said Becky Perrine, research analyst for Unite Here Local 11.
Great Eagle Holdings owns a union hotel in Toronto, so union officials are hoping that's a sign that the new owner won't interfere with organizing efforts.
The lawsuit is pending.