Hotelier: union pressure, politics keeping convention project alive. (Up Front).

The president of the company that owns the Westin Bonaventure says that support from L.A. Mayor James Hahn for a convention center hotel is being propped up out of pressure by unions.

Peter Zen, who recently resigned as chairman of a city advisory panel investigating whether to build a 1,200-room hotel, said that Hahn and several city councilmembers were acting out of political considerations in their support of the proposed $300 million project, which remains in limbo because of funding squabbles.

"I never had problems with the union until I came out and said I'm against the convention center hotel' Zen said in an interview. "We don't need 1,200 more hotel rooms downtown. If you're interested in helping fill hotel rooms, then bring 1,200 more people downtown to live year-round. That's how you're going to revitalize downtown."

The proposed hotel is part of a planned $1 billion project that would include a 7,000-seat theater, retail and office space, to be built by LA. Arena Land Co.

Without a convention center hotel, say city officials and many hotel managers, Los Angeles will continue losing out on convention business.

There were 16 conventions scheduled for the fiscal year ending June 30, 2003, compared with 35 conventions in 2001. The slide coincides with gains made by competitors like Anaheim and San Diego, which finished expansion projects to their centers.

City officials and analysts have said a new hotel won't be built anytime soon unless public subsidies are used to help pay for the project.

Debate continues

Zen said he was resigning from the Los Angeles Convention Commission so that he can be more candid about the proposed hotel. "I don't want the mayor to have to take any flak for me," said Zen, who was appointed to the commission by Hahn in 2001. "And this way I can also more freely criticize the mayor if I disagree with him."

Deputy Mayor Matt Middlebrook said the mayor was saddened at Zen's resignation, but denied the mayor is swayed by the unions. He said Hahn and union leaders agreed years ago on the need for a convention center hotel, when they were still political adversaries. Where union leaders still disagree with the mayor is over his opposition to the use of public subsidies to help finance the hotel project, Middlebrook said.

"The convention center hotel will get built if it's the right thing to do:' he said. "They mayor will supports it to bring various conventions and jobs to Los Angeles."

City Councilwoman Jan Perry, in whose district the convention center sits, said she thought Zen's resignation was a good decision.

"It was a controversy that detracted from the commission s primary mission, which is to build a convention center hotel, bring jobs to the city and reinvigorate the convention center's business," she said. She declined comment on Zen's assertions about union pressure.

Michael Collins, executive vice president of the convention and visitors bureau, said Zen's resignation wouldn't have an impact on the convention center's operations or the convention center hotel proposal.

Building the convention center hotel is vital to the bureau's continued success of booking conventions, and without providing public subsidies the hotel would not likely get built, according to Collins.

"The issue of building the hotel... is just absolutely fundamental to L.A.'s continued involvement in the convention center business," he said. "Without it I don't think we can expect that convention center to live up to the expectations the community has for it."

Critics believe Zen's objections to a new hotel are based on the business that the 1,395-room West-in Bonaventure stands to lose to a comparably sized downtown hotel.

Zen denies any conflict of interest, saying what's best for downtown is also best for his hotel.

"It's not whether it would hurt my hotel. It's if you build a new 1,200-room hotel with the city's money when occupancy levels at downtown hotels is at 30 percent," he said. "That's a conflict if you ask me."

If the hotel was built with private funds and no public subsidies, Zen said, he could support the project. "If it makes so much economic sense, then why aren't developers lining up to build one?" Zen asked. "I'll tell you why: Because it doesn't make economic sense.

Minimizing damage

Zen recognizes the political heat he has caused Hahn -- whom Zen considers a friend and ally -- since he was elected to a two-year term as chairman of the five-member commission in April 2002.

FIT Investment Corp., the company that owns the Westin Bonaventure, objected last year to a city request for the courts to approve the creation of a special corporation to provide tax-exempt financing for the hotel project. The request, called a validation lawsuit, is commonly used by cities before a large project is undertaken to clear opposition early in the planning process.

By stepping down as the commission's chair, Zen has freed himself to speak out on the city's contract negotiations with the Los Angeles Convention and Visitor's Bureau, whose responsibility it is to help fill those hotel rooms.

The current contract, which gives the bureau a set percentage of hotel bed taxes, is set to expire June 30. In February, the city council approved a resolution to begin negotiations with the LACVB, now underway. Those close to the discussions say it will likely include performance clauses designed to make the bureau's funding contingent on how successful it is at booking conventions.

If a contract is not concluded by June 30, it is expected that the present deal will be extended on a provisional basis.

Zen has long been an outspoken critic of both the bureau and its executive director, George Kirkland. In January, the Westin Bonaventure was booted from the LACYB after Zen refused to pay $58,775 in back membership dues. "I was a member in an organization where I had no vote or say in how things were done," Zen said.