The budding hotel market in West Hollywood’s Design District lured a new investor.
Developer KHP Capital Partners sold the 105-key Kimpton La Peer to Japanese hotelier APA Group for $63 million, or about $600,000 per room, according to a deed recorded in Los Angeles County on July 9.
The San Francisco-based private equity firm completed the five-story building at 627 La Peer Drive in 2017 on a former industrial block where tenants like Anawalt Lumber are now dwindling. Kimpton La Peer was the first hotel to open in the district surrounding the Pacific Design Center.
The deal with APA is proof of West Hollywood’s continuing appeal to “unique capital sources,” said Newmark’s Tony Malk, who arranged the deal for KHP along with Greg Morgan and Griffin Garbarini.
Buyers are still willing to bet on the Los Angeles hospitality market as “a strategic, long-term investment,” Malk said.
Global growth plan
The deal is part of a global growth spurt for APA that’s included new partnerships with hotel chains in North America, the firm announced.
KHP’s Benjamin Rowe, who didn’t respond to a request for comment, signed the deed. Rowe, a former Kimpton executive, launched KHP in 2015 along with Mike Depatie and Joe Long after British conglomerate Intercontinental Hotels Group acquired the boutique hospitality chain but spun off its fund management business.
Kimpton operates four hotels in L.A. plus at least seven others around California, according to its website. The franchise frequently partners with KHP to develop its hotels.
