Guggenheim Partners to Bankroll Beverly Hilton's Transformation (Exclusive)

The Beverly Hilton

The plan to turn the legendary hotel where Esther Williams gave swimming lessons and Whitney Houston died into the West Coast's first Waldorf Astoria starts construction in 2014.

This story first appeared in the Oct. 25 issue of The Hollywood Reporter magazine.

One of the biggest on-again, off-again real estate deals in Los Angeles is back on in a big way. 

The Beverly Hilton Hotel, opened by Conrad Hilton in 1953, has played backdrop to a host of Hollywood highs and lows (Esther Williams gave swimming lessons to the visually impaired; Whitney Houston drowned in a bathtub there in 2012). Now, the plan to turn the 569-room hotel into the West Coast's first Waldorf Astoria is picking up steam. Guggenheim Partners (THR's parent company) will be lead investor and co-developer on the project, which starts construction in 2014 and won't be completed for "several years," according to one commercial real estate expert.

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The enterprise originally was proposed in 2006 by Hilton Worldwide, which owns the Waldorf Astoria brand, as a $500 million development that would demolish the existing hotel's main tower and replace it with a 170-room, 12-story Waldorf Astoria, as well as two separate luxury condo buildings. The plan was approved by the Beverly Hills City Council, but progress ground to a halt when the recession hit.

The hotel's current owner is Beny Alagem, co-founder of Packard Bell Electronics and CEO of Oasis West Realty LLC, which purchased the 8.9-acre property in 2003 from Merv Griffin, who had owned it since 1987. A spokesperson for Oasis West declined comment.