Bisnow Exclusive: Why This Asian Developer is Betting Billions on LA's Hotel Scene
Asian investment dollars continue to flood the LA market, and while the first wave of developments were in the multifamily sector, hotels are heating up. Bisnow chatted with Shenzhen Hazens Group executive project director Sonnet Hui, for some exclusive details about the $700M W Hotel & Residences her firm is building in Downtown LA’s South Park neighborhood. You can hear even more at our 3rd Annual Los Angeles Hospitality Boom, Nov. 17,at the InterContinental Century City.
Bisnow: As a foreign investor, what specifically about LA drew your company to invest here?
Sonnet Hui: Starwood is experiencing strong demand for W Hotels in key metropolitan markets across the globe due to the outstanding success of this legendary industry innovator. LA is one of the world’s leading tourist destinations, and we are excited to introduce a new 5-star W hotel into this dynamic part of the city. LA hosts 6.5M international visitors annually, 20% of them from China. In fact, LA is an important gateway market for travelers arriving from China and other East Asian countries.
Bisnow: Why did Hazens choose Starwood’s W Hotel as its brand partner, what types of features and services are planned that will make the W Hotel Los Angeles standout from other lodging choices in Downtown, and what do you envision as your target market?
Sonnet Hui: We conducted extensive research of hotel brands before deciding that the W Hotel’s DNA is a perfect fit with our vision, for this hot, dynamic neighborhood and our flagship investment in Los Angeles. This partnership with Starwood Hotels & Resorts offers an opportunity to provide a quality hotel experience at the W Los Angeles Downtown that will attract global jetsetters and trendsetting locals alike. We will bring the W hotel’s cutting-edge design and a “whatever/whenever” service philosophy to Downtown’s dynamic and vibrant Sports & Entertainment District.
Bisnow: Could you describe the type of visitor experience you envision for guests at the W Los Angeles Downtown?
Sonnet Hui: Downtown LA is undergoing a rapid revitalization, and we’re excited to add fuel to this fire by providing a bold, modern and unique lifestyle experience at the new W Los Angeles Downtown. The hotel’s programming will reflect the W DNA of design, music and fashion. It will draw upon its unique location in South Park at the confluence of Downtown LA’s Fashion District, Hollywood’s music industry, and the rich tapestry of the City’s diverse culture, which is an inspiration for architectural and interior design throughout the region.
The hotel is part of an upscale mixed-use development directly across from the L.A. LIVE entertainment complex. The W Hotel Los Angeles will curate a visitor experience that provides services tailored to individual—“Whatever and Whenever”—needs and desires and introduce guests to Downtown’s many opportunities and amenities, from shopping, unique dining and fresh-foodie scene to the nightlife, arts, music and other cultural opportunities, like Disney Concert Hall (pictured).
Bisnow: How will the hotel’s physical design and features enhance the visitor experience?
Sonnet Hui: Our ultra-modern hotel will offer 250 stylish guest rooms and suites and feature a 5k SF spa with massage treatment rooms and an outdoor WET pool deck with a poolside bar and grill. Plans also include a W Hotels The Store; and state-of-the-art meeting and event space.
Guests arriving at W Los Angeles Downtown will be welcomed in the hotel’s W Living Room—W’s signature mix-and-mingle spin on the hotel lobby, offering global fun-seekers a gathering place to sip innovative cocktails and enjoy regular “Happenings, which showcase the world’s latest and upcoming trends in music, fashion and design.
Guests and locals will also enjoy a signature restaurant, as well as a destination bar that will offer a hip, dynamic nightlife scene. We will also partner with designers, artists, musicians and other innovators to create compelling programing in key areas of the hotel. This will ensure the hotel and guest experience remains fresh and delivers what’s new and next on a continual basis.
Bisnow: What is your project’s schedule?
Sonnet Hui: We submitted our project to the City’s planning department in March 2015, and hope to have a public hearing scheduled within a year. We anticipate construction to begin in 2017.
Bisnow: What are the greatest challenges to building a hotel in Downtown LA?
Sonnet Hui: Our first challenge was finding the right location and the right brand for that specific location, which we have now fulfilled. Our project is unique in that we are one of the first large-scale, mixed-use projects to be going through the entitlement process right now. Other large-scale foreign investment projects in Downtown were entitled in the previous development cycle, but ours was not. So our second biggest and ongoing challenge is navigating the city’s entitlement process, which involves navigating the legal and regulatory waters, as well as the city’s decision-making process.
Bisnow: What has been your experience getting your project’s entitlements through the City’s laborious system? What types of issues are the most frustrating? Have you received any assistance, and if so, from where?
Sonnet Hui: The good news is the Downtown business community, which includes the neighborhood councils, Central City Association, Chamber of Commerce and other business associations have been very supportive and welcoming of new developments and specifically our project.
What is challenging is that the outdated planning codes and other city regulations, many of which were written many years ago and are not best suited to today’s urban mixed-use development trend. We are, however, fortunate to have good support from the City family, including the Councilmember José Huizar’s office (CD-14) and the Mayor’s office, which has helped facilitate the process and meetings with the various city departments.
Bisnow: What is your project’s schedule?
Sonnet Hui: We submitted our project to the City’s planning department in March 2015, and hope to have a public hearing scheduled within a year. We anticipate construction to begin in 2017.
Bisnow: Could you provide an overview of the Hazens’ Downtown LA project, as well as some background about your company and its development approach, particularly when working in cities outside of China.
Sonnet Hui: Our plan is for mixed-use, high-rise development on the site of the current Luxe City Center Hotel. The project includes three towers with 650 residential units, 250 hotel rooms and 80k SF of commercial space on the first two levels.
Our approach is guided by Hazen’s development philosophy, which believes in full integration and collaboration with the city and local community, leveraging the best local experts to navigate the legal process and make projects successful. Hazens recognizes that LA is an area with lots of needs—housing, schools, public spaces and hotel rooms for the convention center. And we are fully committed to LA and to balancing all these needs.
Hazens is a privately owned development company, so at the end of the day the project has to make financial sense. This project will naturally drive itself, but our goal is to create a win-win situation for all. We are excited to be investing over a billion dollars in LA with three current development projects, including $700M on this project, and we believe that global investment and partnership are drivers of a thriving LA economy. Our other developments include the Sheraton Gateway LAX (pictured below) hotel, the Luxe City Center Hotel and a new 200-room Sheraton (pictured is recent groundbreaking) under way in the San Gabriel Valley.
Bisnow: Could you provide your thoughts or predictions about Downtown’s current hotel development boom, and explain why Hazens is investing in three LA-area hotels?
Sonnet Hui: We know LA is a Gateway City, particularly for Asian travelers. Chinese tourism will increase 10 fold by 2020, according to LAEDC. Additionally, LA is the top US trade gateway to and from China and accounts for nearly 45% of all trade between the two countries.
Those factors have coincided with the Downtown LA boom. But most importantly, we truly believe in goals envisioned and laid out by the City’s leadership and business community. A lot of people have put a great deal of effort into shaping LA’s future, and we want to be part of Downtown’s Renaissance. We believe that LA residents are ready for an urban lifestyle and will want to live and work in the urban core. So with our expertise in large-scale, mixed-use urban developments in Shenzhen, we know that we can contribute to the making LA’s new urban core great.
Want to hear more? Join us Tuesday, Nov. 17, for Bisnow’s “3rd Annual Hospitality Development Boom,” hosted by the Intercontinental Century City. Sign up here!
