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Sample Investment: W Hollywood Hotel and Residences
Funding New Development Projects
HEI's development activity is concentrated around urban full-service and top MSA select-service projects; however we will pursue more complex mixed-use opportunities when we believe we can achieve outsized returns relative to our other development activities.
We identified just such an opportunity in summer 2004: a proposed 305-room W Hotel with 143 W Residences, 15,000 SF of retail and 19,000 SF of advertising/signage space located at the world-famous intersection of Hollywood & Vine in the resurging Hollywood District of Los Angeles. This complex project is jointly sponsored by Los Angeles' Community Redevelopment Agency and Metropolitan Transit Authority (owner of most of the site) and was awarded to Gatehouse Capital and Legacy Partners through an RFP process in 2001. HEI formed a joint venture with Gatehouse in 2004 to develop the components discussed above while Legacy partnered with CalPERS to develop an adjacent 375-luxury apartments, 50,000 SF of retail and an additional 12,000 SF of advertising/signage space.
Upon joining the development team, HEI assisted Gatehouse through the entitlement process in addition to helping drive the hotel programming and participating in the project design and condo marketing components. The combined $600 million project broke ground in June 2007 and has an expected completion date by fourth quarter 2009.
 
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