Santa Monica Hotel Owners To Pay $1M In Penalties, Restitution

SANTA MONICA, CA — The owners of a luxury hotel that was built in Santa Monica without the required permits have agreed to pay $1 million in penalties and restitution, the Los Angeles County District Attorney's Office announced Wednesday.

Under the settlement, Sunshine Enterprises must pay $250,000 in civil penalties beyond the $15.6 million penalty that the company has already paid to the California Coastal Commission involving the Shore Hotel. The Shore Hotel is located at 1515 Ocean Ave, Santa Monica.

The combined civil penalties mark the largest penalty ever imposed for violations of California's Coastal Act, which regulates the development of coastal areas and mandates that the commission preserve affordable access to the state's coastline, according to the District Attorney's Office.

The company must also pay $750,000 in restitution to the District Attorney's Consumer Protection Trust Fund for the enforcement of consumer protection laws.

The settlement allows the company to pay up to the half of the $1 million settlement by providing discounted room rates to first responders and other essential workers during the COVID-19 pandemic, according to the District Attorney's Office.

Los Angeles County prosecutors — who had filed a civil complaint — alleged that Sunshine Enterprises violated state law by falsely representing to the Coastal Commission that its proposed construction of the hotel would provide low- to moderate-cost lodging to replace two older lower-cost motels that had been on the property.

Sunshine demolished its existing motels near the Santa Monica Pier and built the new upscale hotel, which the company's website described as a luxury boutique property, according to prosecutors, who said the hotel was built without proper permits that include providing affordable access to the state's coastline.

"The planning and permitting process ensures our community has the opportunity to provide input into what our neighborhoods look and feel like for decades to come," District Attorney George Gascon. "When that process is subverted, some of us are making decisions for all of us."

- City News Service and Patch Editor Nicole Charky contributed to this report.