Discussions to Keep CRA in the Historic Core Moving Forward
Eric Richardson
[Flickr]
A move by the Community Redevelopment Agency would leave the upper floors of the 1902 building at 354 S. Spring almost entirely vacant.
DOWNTOWN LOS ANGELES — Two weeks after the board of the Community Redevelopment Agency authorized interim CEO Calvin Hollis to move to City West's Garland Center, talks are still underway to keep the agency in the Historic Core.
According to a story published today in the L.A. Times, reluctance to make the move was what led to the November resignation of CEO Cecilia Estolano. In an email, Estolano accused Deputy Mayor Robert "Bud" Ovrom of pushing his own agenda in supporting the move.
The move seemed a done deal when it went to the CRA board, but the landscape has since changed dramatically. Developer Allen Gross, currently finishing up a residential conversion of the Blackstone department store at 901 S. Broadway, has entered into an agreement to purchase the Banco Popular building at 354 S. Spring, and appeared at the meeting to pledge his commitment to resolve the agency's issues with deferred maintenance in the 1902 structure. According to Gross, CRA Interim CEO Calvin Hollis told him at the time that the move was too far along, but negotiations have progressed in the weeks since the meeting.
The scene inside the Mayor's office has changed as well. Ovrom was recently made head of the Department of Building and Safety, and a source familiar with the negotiations told blogdowntown this week that he believes the Mayor's office is now open to having the agency stay.
Gross today provided blogdowntown with a cover letter to the proposal he yesterday sent to the agency and Travers Realty, the broker representing the CRA. It details a renovation schedule for the structure and rent terms that Gross says would save the agency $2.7 million over a 15-year lease.
Still, complications remain. A source involved in the purchase discussions told blogdowntown today that Travers' commission demands remain a point of contention between the parties. A broker would traditionally receive a much larger commission for moving a major tenant into a new building than for renegotiating a lease in their current quarters.
The redevelopment agency has been a tenant at 354 S. Spring since 1980. It occupies nearly 100,000 square feet in the building.
Update (Wednesday, 11am): The lease discussion at 354 S. Spring is a closed session item on the agenda for tomorrow's CRA board meeting.
mike on January 05, 2010, at 02:32PM – #1
Broker commissions should NOT be an issue. It looks like Travers' reality has their own best interest here rather than the CRA, which is a public agency, and whats best for the community. Besides, its an existing tenant, all they are doing is renegotiating a lease!"
Douchebag Suit on January 05, 2010, at 05:34PM – #2
Neither the fact that the CRA is a public agency nor any consideration of what's best for the community should factor into a broker's negotiations. However, the broker has a fiducuary duty to act in the best interest of its client. THAT is why commission should not be an issue. Of course, when I woke up this morning I noticed I was in the real world - where broker commissions matter a lot.
Russell Brown on January 06, 2010, at 12:09AM – #3
Met Allen about 2 months ago as we did a 2 hour walk thru on the Blackstone Building. He is completely rehabbing the 100 year old building at Broadway and 9th with residences and hospitality venues on the ground floor.
They dug under the building and cut through the foundation to add a second level of parking underneath. He is also restoring the historical feautures in the Blackstone which had been abandoned and bankrupt for 6 years. Water poured through the unprotected center atrium and destroyed all the improvements in the interim.
That project is significantly more complicated than the rehab of the Banco Popular building. Would be great to see this building with ownership that rehabs it and activates all the ground floor store fronts on 4th and Spring. Take out the black glass and open it up to the street.
Allen seems smart, very sociable and easy to work with. Thanks Tyler for the intro. Would be a great addition to the neighborhood.
Brigham Yen on January 06, 2010, at 04:31PM – #4
I hope the CRA stays in the OBD because I think it'll harm the community if they leave.
This Allen person sounds like a great guy. I hope he continues to purchase buildings owned by Jamison to rehab them since Jamison isn't the kind of company that makes investments to their properties (look at the hideous Macy's Plaza that destroys the Financial District's potential).
Lawyer LA on January 06, 2010, at 05:52PM – #5
Ugggh, brokers! Can't live with them, and ...wait a minute, we can live without them. They do nothing!
Downtowner on January 06, 2010, at 08:44PM – #6
Isn't it required that the CRA office for each region be located in the region's project area?
to Downtowner on January 12, 2010, at 11:30PM – #7
The Downtown project area extends west to Vermont Ave, so City West (Garland Bldg) is still within that area.
Eric Richardson (@blogdowntown) on January 13, 2010, at 07:55AM – #8
That's actually not correct. The Downtown region office can't move to the Garland Center because it isn't in one of its redevelopment projects. This move has been about the agency's headquarters, which doesn't have the same rules.
You can see a list of the Downtown project areas on the CRA's website.