20 May 2011
- Written by Jack Humphreville
LA WATCHDOG - You never would have guessed that the area around Hollywood and Vine was a hot bed of economic activity based on the concessions that the Community Redevelopment Agency and the City Council granted to the inexperienced,
under capitalized, and litigious Hal Katersky and his Pacifica Ventures, the developer of The Cesspool on Vine, the “shovel ready” $57 million Class A office building located at 1601 North Vine, a block south of Hollywood and Vine.
Yet, according to Roger Vincent’s May 13 article in The Los Angeles Times, [link]
“Big Building Project Planned Around Capital Records Tower,” New York City developers, Millennium Partners and Argent Ventures, are proposing a 1,000,000 square foot development less than two blocks north of The Cesspool on Vine.
This $1 billion Millennium Hollywood development is on 4.5 acres and will consist of two towers, one of which is an overwhelming 48 stories. The preliminary plans call for a hotel with 250 rooms, 300 to 600 condos and apartments, 150,000 square feet of offices, and 100,000 square feet of retail space.
And less than a quarter of a mile to the east of The Cesspool on Vine is Blvd6200, a $500 million development of 1,000 apartment units and retail space.
(Note: According to March 31 post on Curbed LA, only 10 of the 143 residences at the W Hollywood have been sold.)
However, neither of these two massive developments was part of the discussion in the more than a dozen meetings of the CRA and the City Council prior to the Council’s March 9 approval of Disposition and Development Agreement (the “DD Agreement”) which resulted in a $4.6 million concession to Pacifica Ventures and Hal Katersky, the principal in the now bankrupt Albuquerque Studios.
But that begs the question: Why weren’t Millennium Hollywood and Blvd6200 part of the conversation? Especially since the CRA and City Hall were more than aware of these projects that would hardly support the claim of a blighted neighborhood?
For openers, the disclosure of these two projects and the resultant discussion would have blunted the arguments that supported the almost $5 million gift to Hal Katersky. This is the same Hal Katersky who was alleged to have engaged in “various acts of fraud and embezzlement” by the owners of Culver Studios and who made “a large financial settlement” and gave up “all [his] financial interests” in Culver Studio.
Of course, a full discussion of these two monster projects along with The Cesspool on Vine would have focused on the disruptive impact on the local community of these multiyear construction projects.
Furthermore, it would have triggered a call for a comprehensive plan for the area surrounding the historic Hollywood and Vine intersection, analyzing the impact of this massive increase in densification resulting from all the new residents and retail space on the already congested intersections, the surrounding lunar cratered streets, and the surrounding communities.
Eric Garcetti, in defending the 2006 $5.45 million purchase from Ullman Investments, representing a $1.35 million, 35% premium over the CRA appraisal of $4.1 million, and the bargain basement sale price of $825,000 to Katersky, said the Vine Street Tower project would be “aggressively scrutinized” given the high level of public skepticism.
Now is the time to begin aggressive scrutiny of the current status of the Vine Street Tower, including the necessary leases need to secure the financing, the debt and equity financing arrangements, and whether this “shovel ready” project will begin in earnest in the fall as promised by Katersky.
Furthermore, the local Hollywood business and residential community deserves to get a better understanding of the collective impact of all this development and resultant densification.
And finally, Angelenos need to understand why the CRA, the City Council, and Council District 13 did not consider the Millennium Hollywood and Blvd6200 developments when approving the DD Agreement.
Of course, the underlying reason is that the developers of Millennium Hollywood and Blvd6200 may be maneuvering for big time handouts from their cronies at City Hall at a time when the City is broke!
Is The Cesspool on Vine just part of The Hollywood Cesspool?
Vol 9 Issue 40
Pub: May 20, 2011