Construction Progressing : New Hotel’s Hopes Linked to Performing Arts Center
In the year 2086, a century-old time capsule will be removed from inside the $25-million Beverly Heritage Hotel, now under construction in Costa Mesa.
Among the items that will be found inside the bronze capsule is a 1986 schedule for the Orange County Performing Arts Center’s premier season.
Like the time capsule, both the hotel and the Center are yet to be unwrapped. It is no accident that the 238-room Beverly Heritage is scheduled to open just two weeks after the Sept. 29 grand opening of the nearby Center. It is also no accident that the hotel has the Center for a front yard.
“The Performing Arts Center will become the focal point of arts in Southern California. We wanted to be a part of that,” said Gerald M. Kadish, president of the hotel’s development arm, Northview Corp.’s hotels division of San Diego. Developers hope the hotel will get a sizable chunk of business from guests attending concerts at the center.
Although the Beverly Heritage--which laid its last steel beam last week--stands in the shadows of the almost-completed Performing Arts Center, the six-story hotel will soon be casting its own shadow.
Prices in Middle Range
The hotel, which will offer upper-end amenities at mid-range prices, will be a prototype for all future Beverly Heritage structures. Developers hope that the tiny, three-hotel chain will eventually grow into a national operation. Current plans are to open at least three new lodgings annually, Kadish said.
Luxury hotels are not entirely new to the company. Northview is a subsidiary of Beverly Hills Hotel Corp. of Beverly Hills which operates the luxurious Beverly Hills Hotel. The 268-room hotel, home of the famed Polo Lounge, is undergoing a multimillion-dollar renovation.
Northview recently purchased the 27-year-old Vagabond Inn hotel chain, which owns and operates 43 hotels--mostly in California. Vagabonds, however, are budget-priced hotels with room rates at about $40 per night. With the introduction of the Beverly Heritage concept, Northview is trying to break away from that mold.
But the image change may be difficult, consultants say. After all, under the Vagabond name, the chain has recently become accustomed to operating hotels that mostly attract families on strict travel budgets. Now, with Beverly Heritage, it is going after the executive market.
‘Different Product’
“It will be an entirely different product from Vagabond,” Kadish said. Just as such large chains as Marriott and Quality Inn can produce different grades of hotels, so can Northview, he said.
Kadish came to Northview two years ago from Harley Hotels, where he was executive vice president. He originated the Beverly Heritage format, which he said is modeled after European hotels.
The Beverly Heritage may mark just the beginning of a slew of new hotels in the South Coast area--where new condominium complexes and more office buildings are also in the planning stages.
Plans for at least two other hotel sites in the general area have been informally discussed. A 400-plus-room Regent Hotel and a 200-plus-room Marriott have both been proposed. The 396-room Westin South Coast Plaza is the only hotel now operating in the vicinity. The additional construction would rocket the number of rooms to more than 1,200 rooms at all four lodgings.
But industry consultants say the South Coast location can accommodate the growth. “The prospects are good,” said Helen Gavin, office manager at Pannell Kerr Forster’s Newport Beach office. “The whole South Coast area is becoming like a city within a city.”
‘Good Synergism’
The hotels will be “mutually supportive,” agreed David R. Kinkade, manager of leisure time industries at Laventhol & Horwath’s Costa Mesa office. “In the short term it will be very competitive, but the South Coast area is growing and there should be good synergism between the different hotel concepts.”
But Robert Seddelmeyer, general manager of the Westin South Coast Plaza, isn’t looking forward to the competition. The 11-year-old Westin has been the lone lodging in the area since it was built. “It’s still a big question mark just how much business the Performing Arts Center can generate” for area hotels, Seddelmeyer said. “The last thing we need here are additional rooms.”
Not only does the Westin suddenly find itself facing a new competitor, but the competitor promises to charge $30 below the area’s market rates. “Our rates will be considerably under $100,” Kadish said.
Despite the lower rates, the Beverly Heritage will offer amenities like telephones in all guest room bathrooms, terry cloth robes, free weekday newspapers, free local phone calls, free airport limousine service and personal computer outlets in guest rooms.
The hotel will also have a pool, exercise facilities, and evening turn-down service.
Leases to Cut Costs
To cut costs, the hotel will lease its restaurants--both indoors and outdoors--to independent operators in a connecting two-story structure. The same attached facility will also house a lounge and meeting rooms that will be operated separately from the hotel. Developers also save money by keeping the size of the lobby to a bare minimum.
Even with these cost-cutting measures, developers envision a slow start. “We have no illusions over the fact that occupancy will be low the first few years,” Kadish said. “But over the long haul, we’re in an excellent location.”
Unlike the Westin, which is dependent on the convention-goer, the Beverly Heritage will appeal to individual travelers who are visiting the area for business or pleasure, Kadish said.
In August, the Beverly Heritage plans a mass hiring of nearly 200 employees, Kadish said. The hotel has yet to name a general manager.
