Letter: Merritt and Honarkar Responsible for Hotel Laguna Delays


In Michael Ray’s recent Aug. 27, 2021 column “Who Wants Hotel Laguna Closed?” he leaves out the culpability of property owner E. W. Merritt Farms and operator Mohammad Honarkar.

After all the prior operator of the Hotel Laguna, the Andersen family wanted to extend their lease and the Hotel Laguna would have continued in operation. Then a group led by Joe Hanauer and Greg MacGillivray had plans to restore and reopen the Hotel when at the last-minute Honarkar apparently made a higher bid to lease the Hotel. See Orange County Register Jan. 11, 2019 article by Erika Ritchie “In surprising turn of events, new operator takes over 99-year lease of Hotel Laguna”. We’ll never know what a wonderful job Joe and Greg would have done and how far along they would be by now.

In his column, Ray asks “why can’t Laguna get its act together and get the hotel open?” The blame clearly is due to fact that Honarkar cannot get his act together and follow legal regulations and procedures.

Over a year ago, Community Development Director Marc Wiener communicated to Honarkar: “you must provide the City with a comprehensive plan for Hotel Laguna project. Such a plan must include a schedule and description of the future work that is proposed.” In addition, the California Coastal Commission has been trying to obtain from Honarkar “an update on the resolution of the violations and submittal of a complete application”.

What has Honarkar been doing to the Hotel Laguna? According to the city staff report:
– Stop-work orders were issued to Hotel Laguna due to unpermitted work that was taking place at the hotel.
– For unpermitted electrical and plumbing work.
– For unpermitted work to the kitchen.
– For construction of a new bar.
– For additional electrical work.
– For replacement of windows.
– For exterior work that included removal and reconstruction of retaining walls as well as trenching at the rear of the building.
– For unpermitted installation of a beverage line and associated CO2 tanks.
– A concrete patio had been poured and the southerly portion of property has been backfilled without the benefit of permits.

The Coastal Commission staff found substantial issue with the issuance of Coastal Development Permit (CDP 2020-7925).

City Manager Shohreh Dupuis says Honarkar threatened to sue the City. The City Council with its legal counsel and others met at a closed session regarding the potential litigation related to the project. The stop-work order was modified, allowing Honarkar’s Laguna Beach Company to complete the Hotel Laguna restaurant.

This isn’t the fastest or best way to restore and reopen a hotel that should be added to the National Register of Historic Places.

Yours truly,

Gene Felder, Laguna Beach


  1. These are all excellent points. Why is it the city’s job to somehow make Mo Honneker’s purchase of the lease on Hotel Laguna work for him? All of the many properties he has purchased in Laguna with the intention of developing them are stuck, due to his own mistakes. this has been a disaster for the city, but certainly not the city’s fault, nor does it constitute the city’s obligation to make things easier for Honneker to develop.


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