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Sam Nazarian Talks What's Next for Former Palihouse in Hollywood

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Last Friday, writer Charlie Amter broke the news in the Los Angeles Times that Sam Nazarian will take over operations at the former Palihouse hotel in Hollywood. Originally owned by developer By Palisades, and then purchased via a distressed sale by CIM Group, the cardinal-colored building at Hollywood and Vine will operate as a 67-room hotel. There will also be an extended stay element (original developer By Palisades had planned a similar concept), so each room will have a kitchen, washer and dryer. As far as a theme, Nazarian told us the hotel will draw on the influence of music in Hollywood (but don't worry, it won't be like a Hard Rock Cafe with banjos on the bathroom walls). A yet-to-be announced partner will join Nazarian on this hotel, and that partner is said to be in the music sphere. More from our conversation with Nazarian about the hotel, which will soft-open in mid-August.

On differences with this hotel and his SLS Hotel: “This is a completely different product, but it compliments SLS perfectly, it’s a little more bohemian, it’s a little more do it yourself, it’s probably closer to the ACE Hotel in New York, the Gramercy, the Chateau Marmont."

On the competition: “It’s not a very big asset, just 67 rooms, but if we do this product right, it’ll create a new product for us in terms of the extended stay category.... The benefit we have is that we have the biggest room sizes [average room size= 800 square feet] in terms of all our competitors?and now with our extended stay, we’ll be dabbling in both the hotel space, but also the residential space.”

More on the concept: "We’re looking at the myth of being across from Capitol Records, really taking on the musical influence that Hollywood has had on the world?It’s going to be very chic and very elegant."

Details about the restaurant: "The restaurant, we’re going to position it as a culinary center?.As for the concept, we’re going to announce it soon. We’ve been working on it for about three months, we were working on this concept and it just so happened that this project fell in our laps, so we’re going to launch it here.”

On criticisms that SBE's clubs are just about starlets, expensive bottle service: “Well, the starlets and the bottle service, we love the fact that celebrities and people that are out there love to come to our places. We can’t stop that, and we want to design the best product, and give the best service that we can.

As far as the bottle service, there is really no club or lounge here, so it’s not going to be a nightclub with ropes, it’s really going to be focused on the culinary and hospitality side. Hopefully they’ll make money, though, that’s the goal. If people want to buy bottles of wine and champagne in the restaurant, we’ll accommodate that.”

It’s been said a recession is a terrible thing to waste. What have you learned? : "To be honest, 2008, 2009, and some parts of this year have been the best professional years of my life because it’s really focused me on operations, it’s focused me not on growth but on stabilization, efficiencies. When you have 3,000 employees in three states, and you’re a developer, your job is continue to develop. When the spigot is turned off, you really have to make sure you have enough to maintain the status quo until the next round comes, and we think this next round has come. We’re now looking at projects in states like New York, Florida. It’s matured our company, it’s matured us,and positioned us for the next round, to take advantages of projects and to be entrepreneurs."

Three years after opening Katsuya in Hollywood, what the neighborhood needs next: "[This hotel] is in the heart of Hollywood, but obviously it has some time before it becomes a really celebrated pedestrian district?And what is needed next: "Combination of more residential and more office, so [there's more] daytime use, also so there’s daytime use on the weekends, it’s getting more dense. You’ll also see some more big box retail coming."

· SBE Launches New Hospitality Category at 1717 Vine Property in Hollywood [BusinessWire]
· Night Life: Sam Nazarian's Colony vs. David Judaken's MyStudio [LA Times]