The luxury SLS Beverly Hills hotel created by hotel and nightclub mogul Sam Nazarian has been sold for $195 million to Torrance multilevel marketing and hotel firm Sunrider International.
Nazarian's company SBE opened the 297-room hotel in 2008, just as the hospitality industry was going into a recession-related skid. The hotel business has since recovered and investors have snatched up high-end Southern California properties at steep prices in recent months.
FOR THE RECORD:
Hotel sale: In the May 5 Business section, an article about the sale of the SLS Beverly Hills hotel identified the sellers as Sam Nazarian's company SBE and co-owner CIM Group. CIM was not a co-owner of the property and was not involved in the sale. —
In January, the five-star Montage Laguna Beach sold for $360 million — a record $1.4 million per room for a California hotel. The 47-room Malibu Beach Inn traded for $79.9 million in February, and the trendy 182-room Ace Hotel in downtown Los Angeles just sold for $103 million.
This year's sales are building on a 2014 trend that saw real estate investors rush into the hotel business as tourism and business travel surged.
Investors bought 399 California hotels for a total of $5.1 billion in 2014, a nearly threefold increase from 2009, when 92 hotels sold for a combined value of nearly $1.8 billion, according to research by Atlas Hospitality, an Irvine hotel industry consulting firm.
Nazarian said nearly a year ago that he was putting the SLS Beverly Hills up for sale as part of a strategy to reduce SBE's holdings in real estate while expanding its contracts to manage hotels for other investors.
Sunrider was founded by an herbalist born in Taiwan. It makes nutritional supplements, beauty products, weight loss drinks, household cleaners and other food supplements, beauty supplies and other products distributed in more than 40 countries.
It also has a hotel chain called Sunworld Dynasty that owns and operates three hotels in Beijing and Taipei. The privately owned company also recently purchased the St. Ermin's Hotel in London, company representative Jonathan Beutler said.
The SLS Beverly Hills will continue to be operated by Starwood Hotel & Resorts as an SLS hotel, Beutler said. SBE will remain the "brand operator," he said.
SBE and co-owner CIM Group sold the SLS hotel to Sunrider last month. The 2.7-acre property is south of the Beverly Center at 435 S. La Cienega Blvd.
The SLS Beverly Hills interior was designed in a flamboyant style by French architect Philippe Starck. Eye-catching features include a solid-glass deer head mounted over a fireplace and a lamp that looks like a chromed assault rifle. There are 177 styles of chairs.
"Since acquiring SLS Beverly Hills, we have challenged every traditional convention of luxury hospitality," Nazarian said. "Selling the hotel represents an excellent value for SBE and Sunrider International, which shares our vision for this world-class property."
Hotel consultant Alan Reay of Atlas Hospitality Group said Nazarian helped pioneer the so-called lifestyle concept that calls for giving individual hotels more personality than is typical among conventional hotel brands.
"Sam and SLS were really ahead of their time," Reay said. "That is definitely the hot segment right now."
Nazarian bought the Beverly Hills hotel once known as Le Meridien for nearly $90 million in 2005. It opened in 1991 as the Hotel Nikko at Beverly Hills.
There are also SLS hotels in Florida, Las Vegas and New York. An SLS is set to open in the Bahamas this summer and seven others are being developed in Seattle, Philadelphia and other cities.