Officials, Preservationists Optimistic Over Move : Ritz-Carlton to Run Huntington Hotel

The Ritz-Carlton Hotel Co. has been named the future operator of the Huntington Hotel, ending months of speculation over whether the developers could live up to their promise to bring a “four-star” luxury hotel to the city.

Developers Lary Mielke and Thomas R. Tellefsen also announced last week that the Los Angeles-based Community Bank has agreed to provide financing for the purchase of the 23-acre hotel property from its current owner, Keikyu U. S. A. Inc.

“We are entering the era when things are going to start moving forward, and they will move forward quite quickly,” Mielke said. “This is certainly a crucial step.”

The announcements mark a major milestone for the project, resolving many of the concerns of city officials, neighbors and preservationists over the developers’ ability to make good on their controversial plans to demolish the hotel’s deteriorating main building and replace it with a similar-looking modern structure.

Mayor John Crowley said the agreements reaffirm the city’s optimism that the Huntington Hotel will be restored to its former grandeur.

“The Ritz-Carlton has a fine reputation,” he said. “The agreement certainly lives up to our expectations. The requirements of the city were intended to assure the hotel would be of superior quality. This assures that.”

The news was greeted with reluctant optimism by preservationists who had fought plans to demolish and rebuild the 80-year-old hotel.

They had argued during the sometimes-bitter referendum battle over the hotel’s fate in May that Mielke and Tellefsen would be unable to secure financing or find an operator willing to take on a luxury hotel in Pasadena. Opponents questioned whether the area could support such a facility.

But Kit-Bacon Gressitt, a leader of the unsuccessful referendum fight, said the two agreements appear to defuse those concerns.

“Ritz-Carlton has the type of reputation that lends credence to Mielke’s promises,” she said. “This is a hopeful sign. I hate to admit it, but he’s on a roll.”

Gressitt said preservationists still oppose the plan because it requires the demolition of the hotel’s historic main building.

“The historic, social and cultural value of the hotel can never be replaced,” she said.

Gayle MacIntyre, a spokesman for Ritz-Carlton, said the company plans to operate a luxury hotel on a par with its other well-known establishments in Boston, Laguna Niguel, Atlanta and Naples, Fla.

She said the company hopes to open the hotel’s doors in 1990. She refused to elaborate on the details of the agreement.

James H. Cheney, vice chairman of Community Bank, said his company has been considering a loan to Mielke and Tellefsen, partners in Gemtel Corp., since the project’s inception in late 1985.

“We’ve been tracking the project all along,” he said. “I’ve been in good deals and bad deals, but this one looks like it will be a good one for everyone involved.”

Escrow on the property is expected to close this month, Cheney said. He refused to comment on the purchase price of the property or the amount of the loan.

Gemtel still must secure a loan to finance the construction of the more than $40-million project.

Mielke said the cost of building the hotel has gone up from an earlier $38-million estimate, in part because of Ritz-Carlton’s design requirements.

“There’s no question they have very high standards,” he said.

Cheney said Community Bank also is prepared to provide the construction loan.

“I don’t see any problems whatsoever,” Cheney said. “We have the ability and option to take the lead in providing that loan.”

The hotel, built in 1907 by Civil War Gen. Marshall Clark Wentworth, was one of the grandest of the resort hotels that flourished in Pasadena around the turn of the century.

The hotel, then called the Hotel Wentworth, was later purchased by Henry E. Huntington and renamed the Huntington Hotel.

Huntington hired noted local architect Myron Hunt to redesign much of the hotel and add the fifth and sixth floors.

The hotel was sold several more times before it was bought from Sheraton Corp. in 1974 by Keikyu U. S. A. Inc., a branch of a Japanese electric railway company. Sheraton continued to operate the hotel for Keikyu.

The 280-room main building of the hotel was closed in October, 1985, after Keikyu found that the building did not have sufficient structural strength to withstand a major earthquake.

Soon after the closing, Gemtel Corp. offered to buy the property, tear down the main building and replace it with a similar-looking structure.

Gemtel’s plans included preserving and restoring much of the remaining property, including the Picture Bridge, the Japanese and Horseshoe gardens and the Viennese Ballroom.

The city Board of Directors approved the zoning change required for the project to move forward last December, contingent on more than 30 conditions, including finding an operator capable of running a luxury hotel.

Mielke said construction of the new building is expected to begin in 1988 and be completed by mid-1990.

During construction, Mielke said Gemtel intends to keep open the 60-room Lanai and 17-room Royce Hall, which have been operated by Sheraton since the main building closed.

Sheraton announced last month that it would stop operating the hotel next year. Gemtel expects to name an interim operator for the hotel in the next few weeks.

Design details for the new hotel are still being developed, but Ritz-Carlton’s MacIntyre said it will have about 385 rooms, a fitness center, a swimming pool, a terrace cafe, eight meeting rooms, a 10,000-square-foot ballroom and an 8,000-square-foot ballroom.

Ritz-Carlton, an Atlanta-based corporation, was founded in 1983 and is a subsidiary of W. B. Johnson Properties, based in Atlanta.

In addition to the five hotels the company now operates around the country, it plans to open hotels in Rancho Mirage, Phoenix and Dearborn, Mich., next year. The Ritz-Carlton Aspen is scheduled to open in 1990.