Win-Win: History and Development Combine in Los Angeles

(MoneyWatch) 
The Los Angeles Century Plaza Hotel, once considered one of the nation's most endangered historic places, will be spared demolition -- proving that development and preservation can combine to create a successful and cost-effective plan.

Created in 1966, the hotel was designed by Minoru Yamasaki (who also designed the twin towers of the World Trade Center) as a centerpiece for Century City, a community built on 176 acres originally part of the backlot of 20th Century Fox Studios.The 360,000-square foot midcentury modern hotel is known for its curved, glass and aluminum facade and has hosted presidents Nixon and Reagan, astronauts and royalty.

The National Trust for Historic Preservation and the Los Angeles Conservancy began working with the hotel's new owner, Next Century Associates, headed by Michael Rosenfeld, to stop a $2 billion overhaul that would replace the entire hotel with new towers packed with condominiums and stores. With help from City Councilman Paul Koretz, the developer and preservationists are now announcing a new vision and compromise for the property -- preserving 400 hotel rooms while converting a few top floors to condos. Instead of towers, restaurants and shops will be built lower and placed on the sides and rear of the property to retain the integrity of the historic facade.

Yes, it's a far cry from Rosenfeld's original vision of 50-story towers with office, retail, condos and a boutique hotel. But it still has many of the key elements. Although Next Century halved its desired number of hotel rooms to only 400, it also gained an additional 45 condo units.

Preservation and development are often archenemies, but this deal shows that both can occur if both parties are willing to compromise. The gain for developers here -- aside from the lower costs of rehabilitation rather than new construction -- is the goodwill created by appearing to care about how the project will affect the surrounding community. And, let's face it, billion-dollar commercial loans just aren't on the table anymore. The result is that developers now have to compromise more with cities and their agencies, but Century Plaza Hotel shows how it can be done successfully.

Photo courtesy of the Hyatt Regency Century Plaza