The Anaheim City Council last night voted unanimously to approve plans for a Renaissance BLU hotel on an arrowhead-shaped parcel sandwiched between the I-5 freeway and Anaheim Boulevard. The 12-story hotel will have 326-rooms with ground floor and rooftop restaurants, and pool amenities. It will also include a 348-space parking structure and hotel gym.
The hotel developer is Greenlaw Partners of Irvine, which owns four other Anaheim hotel properties, according to the Greenlaw representative who address the city council last night on behalf of the owners.
Critics of city programs to incentivize 4-Diamond hotel construction in the Anaheim Resort are trying to use the Radisson BLU as evidence the incentive policy is unnecessary to attract 4-Diamond properties. The comparison is apples and oranges.
Radisson BLU is an upscale Radisson brand primarily located outside of the United States and a number of BLU properties bear the AAA’s coveted 4-Diamond ranking. However, the proposed Anaheim property will not be one of them. That question was asked during the council meeting and answered in the negative. As a 12-story, steel-framed hotel with considerable amenities, it falls somewhere between the 3 and 4 Star (as opposed to Diamond) ranking.
The Radisson BLU project is considerably smaller in scale and cost than the 4-Diamond projects approved in 2016. Cost of the 326-room BLU project is $168 million, compared to Disney’s $624, 700-room 4-Diamond hotel. Or even the $225 million for the 600-room Westin Anaheim Hotel project, the $208 million for 580-room 4-Diamond project slated for the Anaheim Plaza Hotel site (both Wincome Group projects).
Those differences are just for starters. The cost of a 4-Diamond hotel project in the heart of the Resort District, next to Disneyland, is considerably higher than a 3-4 Star next a freeway and outside the Resort District. When the Wincome Group bought the 8.5 acre Anaheim Plaza Hotel site a few years ago, it paid $47 million – abut $5.5 million per acre. While there is a functioning hotel there, it is old and not a high performer; the price was based on the land value.
By contrast, Greenlaw Partners is buying a 3.3 acre parcel from the city at market for $3.6 million – or slightly more than $1 million per acre (the developer has an agreement to purchase an adjacent 11 acre parcel). Land in the Anaheim Resort is going for $5 million an acre.
The Radisson BLU will be an welcome addition to Anaheim’s hotel inventory. But its development isn’t a refutation of the TOT rebate incentive policy. Constructing a luxury hotel on that irregular parcel is challenging, but the land acquisition and construction costs don’t compare to developing a 4-Diamond hotel project in the middle of the Anaheim Resort.
UNITE-HERE Blackmail – Welcome To Anaheim!
The Radisson BLU developers are on a tight deadline. Their agreement with Radisson Hotel Group calls for the project to be completed in 2020, making them understandably anxious to move forward with construction.
Hovering over that goal like a dark cloud is an appeal of the Planning Commission’s approval – including the CEQA analysis – by UNITE-HERE Local 11, the militant hotel workers union.
UNITE-HERE wants to organize the Radisson BLU employees as dues-paying members. Greenlaw Partners has no interest in unionization, which would drive up the cost operating the hotel. So, UNITE-HERE files an appeal in hopes of leveraging Greenlaw Partners – which is up against a tight delivery schedule – into changing its stance.
The Greenlaw representative told the council that Local 11 representatives were scheduled to meet with Greenlaw Partners the next day, naively stating the union resp wanted to meet to discuss the BLU’s amenities. Yeah. I’m sure the rooftop bar is exactly what the hard-cases from UNITE-HERE want to discuss.
UNITE-HERE is spearheading the $18 minimum wage initiative, in large part to achieve greater negotiating leverage in its current contract negotiations with the Sheraton Park and Hilton hotels. Last year, it spent $160,000 to qualify a referendum on development agreements for Wincome Group hotel projects because the developed declined to help UNITE-HERE organize its employees.
The shakedown is how UNITE-HERE Local 11 works.
District 3 Councilman Jose F. Moreno made a point of asking the Greenlaw representative if the hotel workers would be unionized. As previously noted, the answer was negative. Currently, asking is all Moreno can do. If the long-laid plans of Moreno, UNITE-HERE and their progressive allies come to fruition in the form of a progressive-Left council majority, the question will be replaced by a demand for unionization as a condition of approval.