The Century Plaza Hotel, a 1960s-era landmark in Century City that has played host to several U.S. presidents, has been sold for $366.5 million.
Next Century Associates, led by Los Angeles real estate investor Michael Rosenfeld, announced Monday that it bought the 726-room hotel on Avenue of the Stars from Sunstone Hotel Investors Inc., a real estate investment trust in San Clemente.
The arc-shaped, 19-story structure was built in 1966 as the centerpiece of Century City, an office, retail and residential development carved out of the former back lot of the 20th Century Fox film studio.
"This is a rare opportunity to buy a jewel in my hometown," said Rosenfeld, founder and chief executive of Century City-based Woodridge Capital and managing partner of Next Century, which also includes New York investment firm D.E. Shaw group.
The Century Plaza, which will continue to operate as a Hyatt Regency, "is an iconic building in a fantastic location," said hotel industry consultant Alan Reay of Atlas Hospitality Group.
The sale price of $505,000 per room is high -- but not a record, Reay said. An interest in the Hotel Del Coronado in Coronado went for more than $1 million per room in 2005. The Langham Huntington Hotel & Spa in Pasadena -- formerly a Ritz-Carlton hotel -- sold this year for $434,000 per room.
Sunstone bought the Century Plaza for $293 million in 2005 and then launched a renovation program valued at more than $22 million that upgraded the guest rooms and common areas.
Rosenfeld said he planned further improvements, such as renovating the meeting areas and a possible expansion of the ballroom, which is already the largest in Los Angeles. "Our goal is to continue to enhance the hotel."
Part of the what made the Century Plaza an appealing investment, Rosenfeld said, is its proximity to several high-end office and residential structures.
Right next door, a 42-story luxury condominium tower is under construction in which a unit sold this year for a record $15 million. Five more condominium buildings are planned in Century City.
Across from the hotel on Avenue of the Stars is a $350-million office and retail complex that was completed last year where ABC Entertainment Center once stood.
It's home to talent agency Creative Artists Agency and other entertainment industry tenants. Other nearby office building that command top rents include SunAmerica Center, MGM Tower and Fox Plaza.
"The ability to acquire such a well-located property comes along rarely, and we're pleased we had the opportunity to seize upon it," Rosenfeld said.
Another reason the Century Plaza commanded a high price is that the Westside hotel market is the best in the state for owners, consultant Reay said.
Even with the economy faltering in the first quarter, hotel-industry revenue and occupancy rates were up 6.7% on the Westside compared with a statewide improvement of 2.3%.
"The Westside is resilient and still enjoying strong growth," Reay said
The Century Plaza has been at the center of business, social and political activity on the Westside for decades.
In 1961, after Fox suffered a string of expensive flops, culminating in the box-office disaster "Cleopatra," starring Elizabeth Taylor and Richard Burton, the film studio sold about 180 acres to developer William Zeckendorf and Aluminum Co. of America, also known as Alcoa. The new owners conceived Century City as "a city within a city" with the hotel as a magnet.
When the Century Plaza began operating, its doormen wore red Beefeater costumes. The hotel's ballrooms became the center for numerous high-profile events, including an opening charity gala in 1966 emceed by Bob Hope, who with singer Andy Williams entertained the likes of Ronald and Nancy Reagan and Walt and Lillian Disney.
A year later, 1,300 club-swinging police clashed with about 10,000 Vietnam War demonstrators as President Johnson spoke at a Democratic fundraiser at the hotel. Johnson left without staying overnight.
In 1984, the complex added a 297-room hotel tower. President Reagan was one of its first guests, and a penthouse unit was named after him. The tower was razed to make way for the Century condominium high-rise now under construction and slated for completion in fall 2009.
Woodridge Capital Partners, founded by Rosenfeld in 1988, is a real estate investment company with hotel, residential, commercial and industrial assets in the U.S. and Canada. Rosenfeld recently sold the Carlyle on Wilshire, a luxury 24-story residential tower being built on Wilshire Boulevard, to New York-based Elad Group for $140 million.
The D.E. Shaw group is a global investment and technology development firm with about $36 billion in investment capital and offices in North America, Europe and Asia.