Hotel May Be Harbinger of More to Come
Seal Beach, a town that hasn’t seen a new hotel in nearly half a century, has a $6-million hotel under construction that--overnight--will more than double the number of rooms inside the city limits.
In most cities, only a skyscraper could accomplish such a task, but in Seal Beach three stories will do it, when the Palm hotel on Marina Avenue opens in May with 71 rooms.
Over the years, high land costs and a longstanding anti-growth attitude by city fathers has held Seal Beach hotel development at bay. As a result, Seal Beach’s two current hostelries--the Seal Beach Inn & Gardens and the Bay Motel--have just 48 rooms between them.
Although new hotel construction has been booming in central Orange County for the past two years, Seal Beach has seen none of this lodging growth. That may all soon change, however, as Seal Beach and its environs continue to develop into both corporate and tourist attractions.
The Palm--which replaces a former tree nursery--may be just the beginning of a spurt of hotel development in Seal Beach. Recently there has been movement on new hotel projects proposed on two other Seal Beach sites that could add 350 rooms.
A hotel of up to 200 rooms is being considered for a 3 1/2-acre parcel on 1st Sreet that overlooks the San Gabriel River. The site--which has been a candidate for a hotel for years--is owned by the City of Los Angeles and controlled by the Los Angeles Department of Water and Power. Within four to six months the Los Angeles City Council is expected to seek bids on the site from hotel developers. “We’re closer today (to a hotel on the site) than we’ve been in years,” said Lee Moussafir, chief real estate officer with the Department of Water and Power.
Another potential hotel site is owned by the State Lands Commission. The 2.7-acre site on Pacific Coast Highway could accommodate a hotel with up to 150 rooms, said John Baucke, director of development services for the City of Seal Beach.
New hotels will provide jobs and tax revenues (about $1,000 per room annually) in the area, but some observers speculate that hotels could also change the face of the city of 26,000 residents.
“It’s obviously a very large building for the City of Seal Beach,” said Mark Abrams, president of Abrams Development Inc., the Los Angeles development company that owns the Palm. “But we saw the need and the opportunity,” he said.
That opportunity came to light when studies of the site by two major accounting firms recommended that a hotel be developed, said Abrams, a longtime Seal Beach resident and member of the Los Alamitos Unified School District.
“It’s a natural evolution of that market,” said David R. Kinkade, hotel consultant at the Costa Mesa-based office of Laventhol & Horwath. Seal Beach hotels will basically be an extension of the Long Beach market, he said. The Hyatt Edgewater, just blocks away from Seal Beach on the Long Beach Marina, has been extremely successful in that area, Kinkade said.
Al Gobar, a La Habra-based consultant, said the Seal Beach area may be ripe for some mid-scale hotels. “Most of the hotel construction going on in Long Beach market is upscale,” he said. “They haven’t built too many at the other end.”
The Palm will be marketed as a mid-scale hotel for both tourists and businessmen, Abrams said. It will have five meeting rooms. Room rates will be $70 to $100 per night. The hotel--which will employ 30 workers--will be operated by Home Equity Management of San Francisco.
Abrams said he tried to design the hotel to fit in with the beach atmosphere. Developers will spend nearly $50,000 landscaping the site and will eventually plant 27 palm trees. The hotel will have an outdoor atrium with a pool and spa.
Although Seal Beach’s two other hostelry owners say they do see a market for a hotel like the Palm, they are skeptical about additional hotel projects.
“It’s been so long since a hotel was built that none of us know what to expect,” said Marjorie Bettenhausen, owner of the Seal Beach Inn & Gardens. The 66-year-old inn, which specializes in bed and breakfast, has put more than $500,000 into renovation since 1977. “But it’s not in the best interest of the community to build too many hotel rooms,” she said.
Owners of the Bay Motel have pumped $400,000 into the inn since they purchased it in April, 1985. “I’m not really worried about the competition,” said Katie Goldman, a spokesman for Santa Monica-based MBR Investments, which owns the motel. “It’s kind of like adding one more gas station across the street.”
Seal Beach Mayor Joyce Risner, much like her constituents, has ambivalent feelings about new hotel developments in the seaside town. “I’d hate to see us oversaturated with hotels,” she said. “But where is that point of oversaturation? I don’t know.”
