THIRD STREET — City officials disappointed neighbors of a luxury hotel on Third Street Monday, declaring that there was no evidence that the business had violated any laws despite residents' concerns to the contrary.
The Palihouse Santa Monica — formerly the Embassy Hotel and Apartments — has been under fire in recent months by neighbors who have accused the hotel of operating a public restaurant, doing construction work without permits and packing the street with traffic from a valet operation out front.
E-mails have flown to various sections of city government laden with anecdotes about illegal food service, noise from drunken revelers and pictures of boxes, debris and a discarded sink.
The situation has become unlivable, said Laura Wilson, one of the most vocal people in the anti-Palihouse fight.
"I'm fighting to protect the quality of my home," Wilson said. She says she hasn't been able to sleep past 6 a.m. since the hotel opened this spring, and is woken up in the middle of the night by noisy — and temporary — neighbors.
Unfortunately for Wilson and those that share her concerns, city officials have not found any evidence that Palihouse is violating local laws or regulations.
In a six-page item released Monday by the Planning Department, Principal Planner Bradley Misner asserted that in the eyes of City Hall, the Palihouse was fully within its rights to operate its hotel in the neighborhood.
That includes using temporary residential parking permits for its guests, a valet operation and the ability to serve its guests food prepared on site.
As far as construction, many of the changes to the interior like light fixtures and others have not needed permits, and the owners did take out permits to install two utility sinks, a coffee maker and a floor sink in the lobby.
The hotel wants to provide alcohol to its guests both in that lobby and in their rooms, and has applied for a conditional use permit with City Hall to make that happen.
Although city officials have voiced some concerns about the traffic situation around the hotel, it too seems to be operating within the rules, according to the report.
The building itself, originally built in 1927, has no on-site parking. The Paligroup, owners of the hotel, set up a valet parking system with the blessing of City Hall that parks cars in an off-site lot.
A video posted by Wilson to YouTube shows cars lining up in front of the hotel and a large van making what she said is an illegal U-turn at the end of the street.
The Code Enforcement Division is aware of the issue and working to correct it, said Joe Trujillo, the manager of the division.
"I personally discussed the issue [Monday] with the business operator," Trujillo said. "We're working with the business operator and the valet that there can't be double parking of vehicles in front of that valet."
Code Compliance employees have been investigating complaints brought to them by angry residents by making inspections, working with building and safety officials and even trying to get served by the hotel cafe, something that is against the rules for the general public.
Residents have been unhappy with the pace of the investigations, Trujillo said, but his staff has been monitoring the property on a daily basis for possible violations.
"I think our goals are the same," Trujillo said. "I don't want any property in the city to be out of compliance."
That's little consolation to Wilson, who believes that city officials have been unfairly biased in favor of the hotel business because of the lucrative taxes assessed on room stays in Santa Monica.
Each guest pays an additional 14 percent on their room that flows to City Hall. In the most recent budget, that tax made up 14 percent of general fund revenues.
"It doesn't feel like they're doing anything," Wilson said.
For its part, the hotel owners will be connecting with residents as part of their application to sell alcohol, said Kirsten Leigh Pratt, executive vice president of hotels and branding for the Paligroup.
At that point, they will be able to discuss questions and concerns, and a special e-mail address will also be set up for neighbors' use, Pratt said.
Still, the business is operating "a legal operation" and has all the required permits to do so, she said.
ashley@www.smdp.com
