LA Council OKs AEG Hotel Subsidy

The Los Angeles City Council agreed to provide up to $177 million in development subsidies for a 55-story, 1,200-room hotel and condominium project adjacent to the Convention Center and Staples Center entertainment complex downtown.

The hotel project is a key element of plans by Anschutz Entertainment Group to build the $1 billion complex around the arena, which will include a 7,000-seat theatre.

The council unanimously voted February 11th to approve a memorandum of understanding that calls for the Hilton-operated hotel to receive all of the estimated $100 million to $140 million in hotel bed tax revenue it would generate in its first 20 years.

Developers would receive $22 million in city loans, $10 million in public improvement funds and be exempt from $5 million in building fees.

“We are very comfortable with the terms,” AEG president Tim Leiweke said. Construction could begin this summer.