Computer Entrepreneur to Acquire Beverly Hilton
Merv Griffin will soon be forced to get by without 24-hour room service.
The celebrity business mogul said Thursday that he would sell the Beverly Hilton Hotel, where he lives with his longhaired Shar-Pei dog, Charlie Chan, to computer entrepreneur Beny Alagem of Beverly Hills.
Terms weren’t disclosed, but real estate industry sources value the deal at about $130 million, or $223,000 a room. That would make it the most expensive hotel sale on a per-room basis in Los Angeles County in recent years, though less than half the $549,000 per room being paid for the Hotel del Coronado in San Diego, said hotel expert Alan Reay. The Del Coronado sale, for $385 million, is pending.
Griffin bought the 581-room hotel at Santa Monica and Wilshire boulevards in Beverly Hills for $100 million in 1987 from Barron Hilton, son of hotel magnate Conrad Hilton, and Prudential Insurance Co.
The four-star Beverly Hilton has an excellent location but “would definitely need a tremendous renovation,” said Reay, president of Atlas Hospitality, a Costa Mesa hotel consulting firm. Among the possibilities: adding rooms and retail space to compete with the nearby Peninsula and Four Seasons hotels.
Griffin declined to comment. His spokeswoman, Marcia Newberger, said he would move out of his residence in the hotel, which sits on 8.9 acres and borders Merv Griffin Way. The former singer and television talk show host has a ranch in La Quinta and a home in Carmel.
Griffin, 78, created the popular television game shows “Wheel of Fortune” and “Jeopardy.” He sold them in 1986 and turned to real estate, buying and selling 14 hotels during the 1990s.
Alagem co-founded Packard Bell Electronics in 1986. At its zenith, the Sacramento-based company was the largest maker of personal computers in the nation. But amid fierce competition from Dell Inc., Compaq and others, Packard fell on hard times. Alagem left the company in 1998, a year before its operations were shuttered by majority owner NEC Corp.
The 50-year-old Alagem has owned and managed several properties in California, including a Century City office building and several industrial buildings in the San Fernando Valley. His investment firm, Alagem Capital, is based in Beverly Hills.
Alagem is buying the Beverly Hilton through an entity called Oasis West. Ted Kahan, a former real estate executive for investor Marvin Davis, is president of Oasis West and will run day-to-day operations of the company. The hotel will continue to operate under the Hilton flag.
The 48-year-old hotel is “not exactly a timeless design,” said Kevin Deverich, who ran Griffin’s hotel company for a decade. “It needs to be contemporized” both inside and out.
Deverich is now in charge of hotel acquisitions for Irvine-based Crown Realty & Development, which also bid for the Beverly Hilton. He said Crown would like to buy the property if Alagem doesn’t complete the acquisition, which is scheduled to close by year’s end.
The hotel and the adjoining Robinsons-May department store have long been eyed by developers as a prime site for development that might include more shops and perhaps apartments or condos.
“It would be a mistake not to contemplate mixed-use development,” Deverich said.
