A 2.8-acre parcel near Anaheim GardenWalk is in line for a 466-room, 12-story JW Marriott hotel, according to documents filed with the city of Anaheim.
The developer is GardenWalk Hotel I LLC, a partnership of Prospera Hotels Inc. in Orange and O’Connell Hotels & Hospitality in Anaheim.
A 352-space underground parking structure also is planned.
City staff said the project could go before the planning commission as early as October.
A City Council vote isn’t needed because the land is entitled for a hotel. A nearby parcel also is entitled for hotel, and another could see a 400-unit timeshare development.
All three of the parcels are adjacent to GardenWalk, the 466,000-square-foot restaurant and retail site on Katella Avenue, a half-mile from the Disneyland Resort.
The JW Marriott would join eight others in the area that have opened recently or are expected to by next year. The new hotel would boost the total room count of those projects by a third—from about 1,500 to nearly 2,000.
Plans for the JW Marriott come on the heels of an announcement by Walt Disney Co. that it will expand attractions at the resort with its Star Wars Land.
The Anaheim Convention Center, meanwhile, is in the process of adding 200,000 square feet.
‘Convention Hotel’
The JW Marriott is being considered a “convention hotel” under terms of its entitlement. The second hotel that’s been entitled would be a “resort” property of at least 350 rooms.
A time frame hasn’t been given for the second hotel.
“The agreements for the hotels say the developments would be staggered,” said John Woodhead, the city’s director of community and economic development. “They’ll start a hotel and follow up with the second one.”
The timeshare parcel is controlled by Orlando-based developer Westgate Resorts, Woodhead said.
The company owns about 14,000 timeshare units at 28 resorts in seven states, and Orlando’s Arena Football League team. Its project has planning approval, the city said.
Tax Break
The new JW Marriott is expected to qualify for Anaheim’s transit occupancy tax rebate enacted in June.
A hotel that wants the rebate has to be “four diamond quality,” according to the city.
The designation calls to mind standards set for AAA’s hotel ratings. The city has set outlined benchmarks in an 18-page set of development guidelines that cover the quality of everything from the pool to parking.
Guidelines list 30 hotel brands likely to qualify, including Fairmont, Hyatt Regency, Westin—and JW Marriott.
The rebate returns 70% of Anaheim’s 15% transit occupancy tax to a hotel owner for 20 years after construction.
Rooms at the JW Marriott at the LA Live development in Los Angeles start at $269 a night, according to its website. The chain’s hotel in San Francisco starts at $229; in New York City, rooms start at $339.
At $250 a night and 75% occupancy, the rebate would be worth about $3.4 million a year to the hotel’s owner.
The 30% Anaheim keeps would go to bond repayment and the city’s general fund.
Hospitality sources peg construction costs at $500,000 to $600,000 per room for a hotel of JW Marriott’s typical caliber, putting the cost of the Anaheim project between $233 million to $279 million.
The parking structure has previously been estimated to cost about $20 million.
The hotel is the second recent sign of a rejuvenating GardenWalk area.
The other was House of Blues Anaheim, which said this month that it plans to take a 40,000-square-foot space at the site by next summer. The entertainment venue will exit its 23,000-square-foot space at Downtown Disney.
House of Blues will be at the northwest corner of GardenWalk, Woodhead said.
The hotel will be near the southeast corner of the project on South Clementine Street behind the Cheesecake Factory, which faces Katella Avenue, city documents show.
GardenWalk opened amid the 2008 real estate dive, then endured occupancies of 50%, a bankruptcy, and in 2012 a distressed property sale to three New York City-based investors: Arcturus Group LLC, Avenue Capital Group and Elliott Management Corp.
An acquisition price at the time wasn’t disclosed, but GardenWalk—which defaulted on a $210 million construction loan in 2010—was said to be hopeful of a price ranging as high as $100 million.
The new owners took out a $65 million mortgage on the property, reports said at the time.
They planned at the time of the purchase to shift the site’s mix more toward entertainment and eating and reduce retail space, in line with revamps at other local malls that include the former Triangle Square in Costa Mesa and Kaleidoscope in Mission Viejo.
Anaheim in its planning guidelines shifted about 150,000 square feet of retail space to restaurant and entertainment use, reports at the time said.
