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East Vancouver’s historic Waldorf Hotel, photographed in October 2011.Rafal Gerszak/The Globe and Mail

The closing of Vancouver's Waldorf Hotel – which went from working-class hangout to a key city arts hub two years ago – spawned an online memorial Wednesday over the city's inability to preserve interesting cultural spaces in the face of rampant condo development.

Dismayed responses from city hall, major city artists and random patrons swirled on the Internet after the hotel's young operators announced they would have to close their doors Jan. 20 because the hotel has been sold to the Solterra Group of Companies, a boutique condo developer.

Mayor Gregor Robertson, who issued a statement but didn't give any interviews, said: "The Waldorf closing is a big loss to Vancouver's growing creative community … [The] city is exploring ways to support the Waldorf continuing as one of Vancouver's most unique and vibrant cultural spaces."

The 1947 hotel is not on the city's heritage register, but the land is zoned industrial, which gives the city considerable bargaining power with any developer who comes in wanting a rezoning to build condos.

The moderne-style hotel, with a restored Tiki lounge, two nightclubs and a restaurant, had generated an eclectic mix of activities since it opened in October of 2010, operating almost like a giant arts community centre.

There were concerts by local performers such as Grimes, Black Mountain and the Japandroids, other shows by leading arts figures such as Douglas Coupland and photographer Rodney Graham, a gallery, food-truck festivals, arts-group gatherings and more.

The hotel operators' news release commented bitterly on the fact they had helped create the conditions for developer interest.

"The irony that the Waldorf was taken over by a condo developer in the very area we helped reinvigorate is obvious to anyone," entertainment director Thomas Anselmi said in the release. The other hotel operators are Ernesto Gomez, Daniel Sazio and Scott Cohen.

But others blamed the city for condo speculation along the industrial East Hastings corridor near the Waldorf.

They said the city's willingness to approve another condo project on industrial land nearby set the stage. Three large pieces of property have been bought nearby by major city developers, with two slated for condos.

The hotel, which appears to be part of a parcel of five lots, has been owned by east-side resident Marko Puharich for decades. It was valued at $2.68-million in 2012, but that soared to $3.5-million for the 2013 assessment.

When Mr. Anselmi and his partners took over in 2010, Mr. Puharich said that he could have sold for a lot of money to a big-box liquor distribution outfit. But he wanted to see a better use for the hotel, with all its history.

That changed over the two years.

Mr. Anselmi said he and his partners asked for a break on the rent as they were getting the operation off the ground.

Mr. Puharich agreed. "But in August 2012, the landlord's attitude changed overnight and it was baffling," said the release.

They had to sign a new lease last fall that was for only four months, instead of the original 15 years they had agreed to when before they started on their massive renovation of the hotel.

Mr. Anselmi and his partners were told last week the property had been sold to Solterra and that they could have a week-to-week lease until September. The partners decided to close instead.

That has left bands and other artists scrambling.

Graeme Berglund is co-director of the Black & Yellow gallery, a tiny arts space that's been operating at the Waldorf, rent-free. Mr. Berglund says the closing of the Waldorf is devastating news for them – and for the cultural community as a whole.

"It's been a special, authentic place with really risky programming .… that was a perfect reflection of the real DNA of what it means to be from East Van," he said. "It was the real cultural epicentre for East Vancouver."

Learning officially of the Waldorf's fate Wednesday afternoon, Mr. Berglund was out looking for a new space in Chinatown for his gallery.

Other artists were similarly dismayed.

"The Waldorf began with good people, a common vision and many hands coming together," writer and cultural commentator Michael Turner said in an e-mail. "It was good to feel a part of that, and it was good to see Vancouverites come out in the numbers they did.

Mr. Coupland, e-mailing from outside Vancouver, said: " I'm sad to see it go. It was the coolest, most intelligent watering hole the city's ever had."

Another reaction: "I'm shocked," said Jeffrey Boone, executive director of the Eastside Cultural Crawl. "It was the coolest thing to happen to Vancouver in the past however many years it's been. We only produced that one event there but it was an amazing venue for that. It was so multifaceted; it had great vision. It was just beginning to realize its amazing potential. What a loss."

The Waldorf's interior has been identified as significant, but it is not listed on the Vancouver Heritage Register. "So if anyone wanted to walk in and apply for a demolition permit, presumably they could get it," said Heritage Vancouver President Donald Luxton.

He said the Tiki bar – part of a 1955 renovation of the 1947 structure – is likely the oldest in existence in Western Canada.

"Heritage interiors so rarely survive because uses change, tastes change, things don't stay static."

Mr. Luxton said the city can offer incentives for partial retention, such as more density, and he will make his case to members of council in order to raise concerns about the value of the site. But in the end, it will be up to the owner.