Labor deal paves way for Wilshire Grand hotel demolition, reconstruction

LOS ANGELES Labor leaders and the developers of the Wilshire Grand hotel project have agreed to a US$10 million “closure agreement” to provide benefits for displaced workers. The deal paves the way for the demolition of the hotel next year in preparation for its US$1 billion reconstruction.

Workers at the downtown Los Angeles property will receive severance packages and health benefits when the 58-year-old hotel is closed in December 2011 and will have the opportunity to reclaim their jobs when new hotel opens in 2015.

“This closure agreement is the first of its magnitude in the city’s recent history,” L.A. City Councilwoman Jan Perry says. “With these agreements, Thomas Properties and Korean Air are demonstrating how important it is to them to invest in the people who will build and operate this new landmark.”

Developer Thomas Properties and owner Korean Air plan a redevelopment of the 3.2-acre site that will include a 45-story tower housing a 560-key luxury hotel and about 100 residential units, plus a 1.5 million-sq.-ft., 65-story office tower. The hotel will include a spa, meeting space and retail shops.