When the Hotel Laguna Comes Alive Again
You likely read that real estate mogul Mo Honarkar’s creditors are circling. It appears Mo is in arrears on a $195 million loan mainly secured by his downtown properties. I’m concerned for Mo. He’s got a lot on his plate, including the remodel of the Hotel Laguna, which got me thinking about how that hotel has shaped our town. It’s a long and winding story, so get comfortable.
The corner where the hotel stands was originally part of Henry Goff’s homestead, patented in 1880. In the 1880s-land boom, Goff built two hotels: the 14-room Alpha Hotel, said to have opened in 1886, and the six-room Gray Gables. Goff sold the Alpha Hotel to John and Sue Spencer, and it became the Spencer Hotel at today’s 425 S. Coast Highway. Unfortunately, Mr. Spencer died in 1890, and in the Depression of the 1890s, the hotel failed and went back to the mortgage holder.
The Joseph and Kate Yoch family of Santa Ana had summered at the Spencer Hotel, and Joseph, perhaps seeing an end to the Depression, began to acquire land in Laguna. He bought the abandoned Spencer Hotel for the $600 mortgage, renaming it the Laguna Hotel. The venture did well, and when more rooms were needed he bought the Gray Gables, then the abandoned Arch Beach Hotel down on Diamond Street, which he cut up, moved into town, and attached to the old Alpha Hotel, making 35 rooms with all of two baths. Yoch was the financial founder of Laguna Beach; except for him, we might have been called Arch Beach, which in the beginning had more going. Joseph Yoch died in 1926, just as Coast Highway reached Laguna, bringing more visitors.
Foreseeing the surge of visitors, Los Angeles real estate developer W. I. Hollingsworth followed Yoch by investing here. Hollingsworth was doing well. He had developed the town of Lomita (now part of Torrance), where oil had just been discovered, enriching all involved. Hollingsworth bought the Laguna Hotel from the Yoch Estate and, when it was condemned as a fire hazard, tore it down and built the present 70-room Hotel Laguna (reversing the name) in just 60 days. Yes, 60 days. Times have changed.
Hollingsworth died in 1937, and in 1973, the heirs sold the Hotel Laguna, with a block of surrounding land, to the Merritt family of Porterville, up in Tulare County. The Merritts are an interesting family. Bill and Virginia Merritt got their start over a century ago picking melons, following the harvest from Yuma, Ariz., to the Imperial Valley and then up the Central Valley. They settled down in Tulare County, buying land, farming, and adding land until today. Four generations later, they farm and ranch over 10,000 acres. It’s a great American story.
After World War II, a grandson, Richard Merritt, lived a few years in Laguna, and when the Hotel Laguna became available, he got his family to buy it. They’ve held it ever since, leasing it out to management companies and, in 2018, to a company organized by Mo Honarkar. Was that a good idea? Too soon to say, but time will tell.
It’s been sad to see a piece of our history sit empty and desolate these years. It occurred to me I should call the Merritt family and get their viewpoint. When I called, the family spokesman for the hotel answered, and we talked. Well, I mostly talked. The response was a repeated, “No comment.” I’ve heard that farmers tend to be the strong, silent type. Guess it’s true. But it sure would be great to see our hotel—after 135 years on that corner—come alive again. It is the Laguna Icon. There’s meaning in that.
Skip fell in love with Laguna on a 50s surfing trip. He’s a student of Laguna history and the author of “Loving Laguna: A Local’s Guide to Laguna Beach.” Email: [email protected].
The Merritts are horrendous out-of-town landlords who have no stake or care for Laguna’s future except to bleed as much money out of their decaying properties as possible. I like Mo and wish him success, but this property would have been far better in the hands of the dynamic local trio of visionaries and experienced developers Joe Hanauer, Greg MacGillivray, and Walkie Ray, who had a dynamic plan tee’d up that improved the property (while maintaining its heritage) in a way that would have benefited the whole town. Sadly, things got held up because of years of litigation between the Merritt family and the previous tenants (the Anderssons), so Mo saw an opportunity at the 11th hour and and swept in with a ridiculously overvalued offer. Of course that’s all the Merritt’s cared for. So here we are.
What’s more interesting is how some local developers get the red carpet rolled out for them while others get rolled out in a carpet. If that “trio” had owned the hotel, something tells me people wouldn’t care nearly as much as they do now.
Doug I agree wholeheartedly, but that trio also would have never proposed a 300′ monolith hotel simultaneously, and would have never stated that the project was “their gift to Laguna!” It takes a certain tact – and judgment – to get things done here.
Solution would be to hire Trump to manage it. FINALLY a quality operator in Laguna. Mo, make the call will ya?