The Welcome Group, a development company run by Arjun Shokeen, has secured construction financing to build a hotel in Pasadena.
The El Segundo-based company secured a $36.8 million, three-year loan to build a 194-room hotel, JLL said on Tuesday. transaction.
JLL declined to name the lender, but records filed with Los Angeles County show East West Bank provided the loan.
The Welcome Group acquired a leasehold interest in the property in April from the Charles Company, run by developers Mark and Arman Gabay, records show.
Arman Gabay made headlines in 2018 when he was arrested on federal bribery charges. Last year, he pleaded guilty to paying $1,000 a month in bribes and kickbacks to a Los Angeles County employee over six years and agreed to pay a $1.15 million fine.
The property, at 550 East Colorado Avenue, is currently a parking garage and was planned to be redeveloped into a 110,000-square-foot medical office building. In 2021, the Charles Company and the Welcome Group announced a change of plans—a six-story hotel will hang under AC Hotels by Marriott.
Other regional banks have pulled back on commercial mortgages and construction financing in light of the collapse of three regional banks, Silicon Valley Bank, Signature Bank and First Republic Bank.
The Pasadena hotel deal closed on April 20 — about two weeks after First Republic was seized by the FDIC and sold to JPMorgan.
East West Bank is still making loans to commercial developers and homeowners, sources familiar with the banking business said.
East West also did not cross regulatory thresholds for commercial real estate loans, according to Reuters, citing Trepp data. Other banks, such as PacWest and New York Community Bancorp, have exceeded concentration thresholds established to reduce risk.
Last year, the Welcome Group paid $49 million for Hyatt Place El Segundo, a 143-room property near Los Angeles International Airport.
