Sunset La Cienega’s Condo Project Now Will Be a Hotel

cim, korman communities
The Residences at 8500 Sunset Blvd., soon to become the AKA hotel.

From “The James” to the “1”, and now from the “Residences at 8500” condos to the “AKA” hotel.

The ever-evolving Sunset La Cienega Project has taken yet another turn, first reported in the Los Angeles Times, with the sale by developer CIM Group of the Residences at 8500, two eight-story, 190-unit condo towers, to Korman Communities, which plans to turn them into an extended-stay hotel.

Korman also operates the AKA in Beverly Hills, where rooms are available for a minimum one-week stay at a rate of $4,500 a week. It operates another 10 hotels, including five in New York City (one of which is the AKA United Nations), the AKA White House in Washington, D.C., three hotels in Philadelphia and one in London.

The change of the condos into hotel units is likely to raise concerns among owners and managers of the city’s existing hotels because of the likely impact of it and other projects on room rates. It also may concern some WeHo City Council members such as Lauren Meister, who made an unsuccessful push earlier this year for a temporary moratorium on new hotels until the city could do another study of their impact on the local economy. The conversion will require an amendment to the development agreement for the project, which must be approved by the City Council. If the AKA is not designated as a hotel by the city, it cannot legally rent rooms for fewer than 31 days.

The conversion of the Residences at 8500 Sunset from condos to hotel rooms, along with completion of other hotel projects that are under construction, already permitted or are under review, would increase the number of hotel rooms in West Hollywood by 83%

With the recently completed but not yet opened “1” hotel (formerly the James), the city now has 19 hotels with 2,346 hotel rooms. New hotels approved by the city or already under construction such as the Edition and the Kimpton La Peer would add another 447 units. Other planned projects that haven’t received final approval would add 496 rooms, bring the total to 3,575 rooms. Those projects include 8950 Sunset, Robertson Lane and 7811 Santa Monica Blvd.

A study of West Hollywood’s thriving hotel market by CBRE Hotels, an industry consulting firm, has predicted a major impact on room rates if the seven hotels under construction, those permitted but not yet under construction and those in the existing permit process are completed. CBRE projects the current 85% occupancy rate would fall to 68% by 2020. The study predicts that by 2026 that rate will have risen only to 80%.

The hotel room occupancy tax is the largest single source of revenue for the City of West Hollywood. The tax is 15.5%, with 3% of that allocated to the city’s marketing and tourism bureau. The CBRE study found that the projected increase in hotel rooms would not reduce that revenue. The city’s 2016/17 fiscal year budget projects $23 million in hotel tax revenue. The CBRE study estimates that with the new hotels it will reach $36.8 million in the 2020/21 fiscal year.

The conversion of the condo buildings into an extended-stay hotel does address concerns raised by some consultants and hoteliers that the most of city’s hotels don’t offer distinctive features that allow them to appeal to different audiences. With its requirement of a one-week stay, the AKA will address the market for business travelers who plan long stays.

  1. Dear Ida Claire, I don’t know who you believe to be naive but John Heilman has not been played by developers. There is law and then there is opinion…it’s good to know the difference. You can always present new ideas to council members of your choice for the results you are seeking.

  2. Of all Heilman’s flaunting of his “experience ” at election time, he’s still being played like a game of charades by developers. The developers always get what they want after they play enough games to confuse the council who gets plenty of contributions from same.Maybe Heilman’s too busy trying to promote himself to notice how naive he is after all these years. BTW I think now that we have 4 senior citizens on the council, it’s time for input from some new members with some new ideas who put the city first.

  3. Agree with previous comments. Those black boxes (condos/hotels or whatever) are extremely depressing to look at–what is happening to our beautiful city? Who wants to stay at or live in a cinder block? How about an architectural presence that says “I am a unique and beautiful building proud to be a part of this unique and historic Sunset Strip” rather than those. A disgrace. Hey–how about make them all into total tall walls including the windows. OR even better how about donating them to the city as 100% affordable housing.

  4. Allison – obviously many many people desire West Hollywood as a hotel location, to speak the obvious. The city is the epicenter of the LA region and other than not being within feet of an expressway ideally located for regional vacationing. It is more attractive than Hollywood and yes does have some of its own sights. I first visited the LA area when in college in 1974 and stayed at the (then) Sunset Hyatt because of its location. The same holds true today. And there are, apart from the hotel taxes, benefits to the city from hotels – it provides an upgrade in other amenities such as restaurants and other entertainment facilities.

  5. They should turn the building into low-income housing. But alas…city council wants the hotel tax…so they’ll approve it overwhelmingly. I dont even see the need to fight the city anymore. They always gets what they want and the developers know exactly how to work the city to get what they want. It was probably never intended at a condo complex. They knew they’d do that bait and switch and the city be forced to approve it or have an empty building or something. Doesn’t surprise me one bit.

  6. Like Rob I was wondering if there was an affordable housing component built-in to the project? That certainly would be a red flag regarding this. As for the hotel tax, this is a joke. There’s nothing on the Sunset strip except a collection of a lot of dreary looking buildings. Along with those hedious billboards. You certainly wouldn’t call West Hollywood charming!

  7. The floor plans of these units are horrible and probably no one wanted to buy them. Notice how the corners of the building are not at 90 degree angles. This creates useless space inside the units! When I saw the floor plans I thought they would be a tough sell.

  8. Just curious as I don’t remember..was there an affordable housing component built into the project? If so, will those remain on-site? Did the developer pay into the affordable housing trust? This project has been going on for so many years (Steve Martin was on Council when it first came up, I believe) that I don’t remember the details….

  9. A new concept for the Sunset Strip would be worth contemplating which oddly enough might be in alignment with its historic origins. Extending the ambiance of Sunset Plaza in areas that have potential commercial historic sites would definitely make it interesting. The rock venues 3 to be exact, are destination sites largely attracting folks standing in line in their ragged scruffy attire, then drinking the night away, not likely candidates for extended stay residence or condo purchase. Developing pockets of activity tied to the authenticity of the sites under consideration, could bring up the overall quality of the strip which currently is pretty shabby. The Hollywood tourists are IN Hollywood by the swarms…any day or night do a drive by comparison.

    It would be good to know just what type of composite vision the city has for the strip. Any renderings available? Does the community (or related neighborhoods) have a voice in the overall concept? Or are we going to be spoon fed ideas in increments like the billboard additions which is like studying something in the abstract. Don’t think anyone expects this to look like a child’s game of “Pin the Tail on The Donkey”.

  10. The architecture of the hotel units is truly disappointing! We expected more from such a spectacular site. Those of us up the hill who have watched the full project as it has arisen in our view really didn’t mind having the buildings going up as we felt the view would just be more “urban”. But the buildings they put up are so very ugly that it’s just an eyesore and we are really disappointed. The condos looked like they were very cheaply done with no balconies and crazy windows, so who would want to buy them!

  11. This City certainly does not need more hotels. Really, what is there to see? The Sunset Strip is dead and that was the major thing to draw visitors unless they are really coming to Hollywood and want a hotel that is not in Hollywood but is close by.

  12. The CIM Group was treacherous from the beginning as were the original Millennium Group. There will be no palatable outcome. The city was snookered from the beginning development on this site which should have required 5***** architecture. Instead we have coal black stacked egg cartons with portals propping up billboards that were obviously too disagreeable for anyone to have considered purchase as a condo. Now the hustle for extended stay lodging. These folks and their associates, seem on a par w Mohammed Hadid whose outlaw project in Bel Air recently brought the wrath of Paul Koretz. He has recommended demolition as suitable legal redress. This would be a fitting outcome for 8500.

    The end result should be a park over much needed parking. The city should earmark this project out of respect for the surrounding residents and will not likely miss the hotel tax revenue. Think of it as a charitable contribution for the residents of WeHo.

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