Terms of Kingston Klein's recent purchase of the 64-room hotel at 8358 W. Sunset Blvd. were not disclosed, but Kingston Klein, which is headed by New York hotelier Jeff Klein, is believed to have paid about $18 million for the property. The $15.4-million loan for the buy came from a joint effort between the New York and San Francisco offices of CapitalSource, according to Shiraz Allidina, an investment officer with CapitalSource Structured Finance/San Francisco. Allidina notes that Chevy Chase MD-based CapitalSource has a relationship with Kingston Klein Investors from a previous transaction and was attracted to the deal because of its confidence in Klein as a "talented, customer-focused hotel operator."

Patrick M. McGrath, a principal of Kingston Klein, tells GlobeSt.com that the new owners plan to reposition the Argyle to target more upscale guests. He describes the target clientele as "business customers and leisure customers that are a bit more interested in luxury and service but don't necessarily view themselves as Ritz-Carlton type clientele," adding that the concept will be comparable to the City Club hotel that Klein developed in New York City. "The Argyle building itself is in great shape," so the improvements to the public areas and rooms will be more cosmetic as opposed to structural, McGrath says. He says interior designer Paul Fortune will create the hotel's new look.

The Argyle opened in 1929 and was an apartment building for many years before being converted to a hotel. Its tenants over the years included Hollywood stars and celebrities like Howard Hughes, John Wayne, Paulette Goddard, Zasu Pitts and gangster Bugsy Siegel, according to the hotel's website.

According to Dan Harrington, an investment officer with CapitalSource Structured Finance/New York, the $15.4-million funding commitment includes holdbacks for capital improvements and interest reserve. New York City-based Guggenheim Capital Markets advised Kingston Klein Investors on the recent transaction with CapitalSource, which is a specialized commercial finance company offering asset-based, senior, cash flow, and mezzanine financing to small and mid-sized borrowers.