SoCal Hotel Lands $44M Construction Loan
- Jun 18, 2019
Acres Capital Corp. has originated a $43.5 million loan for the development of Le Meridien by Marriott International, a 233-key hotel currently underway in Arcadia, Calif. The bridge financing carries a term of 24 months, with veteran investors Eric Chen and Wen Fei Shen serving as sponsors.
“The sponsors have assembled a strong development team including general contractor Snyder Langston, who will be overseen by Bob Lisle of Avanti Development Partners, a former Irvine Co. development executive that will be serving as the project manager and Pacifica Hotels, a highly regarded hotel operator,” Mark Fogel, Acres Capital Corp.’s president & CEO, told Commercial Property Executive.
Located at 130 W. Huntington Drive in the San Gabriel Valley, the property is set to be a full-service, four-star hotel. Globally, there are 103 Le Meridien hotels with 27,000 keys combined. However, in the U.S., the brand is underutilized. For instance, a property opened in Denver in 2017.
“Le Meridien is a Paris-born global hotel brand targeting the creative and curious-minded traveler who is eager to experience something new in every destination and discover things with a new perspective. In overseas markets like China, the Le Meridien brand is highly respected which should translate well to the large audience of Asian travelers who visit Arcadia and the surrounding area every year,” Fogel said.
The hotel will be directly across the Santa Anita Racetrack and close to the Santa Anita golf course, Westfield Mall and numerous food and beverage outlets. The mall has undergone several renovations and expansions, with the most recent being a $20 million facelift in 2014.
According to the Los Angeles Tourism & Convention Board, the metro reached a historic milestone in 2018, welcoming 50 million visitors for the first time ever and accomplishing the destination’s tourism goal two years earlier. This marks the eighth-consecutive year of tourism growth for Los Angeles.
Los Angeles set new tourism records for domestic and international visitation, hosting an estimated 42.5 million domestic visitors and 7.5 million international visitors. An all-time high 1.2 million visitors came from China. As a direct result of the surge in Chinese tourism, Fogel said the San Gabriel Valley has witnessed an economic transformation, as tourism brings spending and attracts investment.
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“Chinese tourists are looking for familiar, authentic Chinese food and services, all of which are provided in the suburban residential enclaves in San Gabriel Valley,” he said. “Due to its central location in Los Angeles County as well as the familiarity that the local businesses provide to inbound Chinese travelers, many Chinese tourists choose to stay in the San Gabriel Valley during their trips as they visit the many leisure attractions throughout Southern California.”
Therefore, the transaction represented an attractive opportunity to invest in a Marriott-branded hotel in a prime location. Arcadia draws from the multitude of attractions in close proximity to the upcoming hotel, as well as from the rapidly growing Asian tourist population.