City Council Moves Ahead with Mall Redevelopment

By Jorge Casuso

January 26 -- The City Council Tuesday night unanimously voted to begin negotiations to redevelop Santa Monica Place, but asked developers to start from scratch and engage the public in a speedy process.

The 6 to 0 vote capped a two-month community debate over the Macerich Company's ambitious plan to replace its struggling indoor mall with an outdoor shopping venue topped with three 21-story condo towers, an apartment building and an office complex.

Both the council and Macerich officials welcomed starting afresh after the proposed plan -- which includes extending the Third Street Promenade to Colorado Avenue and linking the site to the Civic Center and pier -- was overshadowed by the towers.

"The action that we take today is the beginning of a process," said Council member Richard Bloom. "We will have a good deal of public process, multiple hearings and oversight. There are many stops along the way before this becomes a done deal."

"We look forward to working with the community on our plans," Randy Brant, the company’s Senior Vice President for Development and Leasing, told the council at the start of the meeting. "We look forward to their input."

"Macerich is thrilled," Brant said after the meeting. "Not only is it great to know we're going to move forward, it's also a thrill that it was unanimous.”

Under the council's direction, Macerich will hire an economic consultant and a "public process facilitator" from a list provided by City staff.

The economic analyst will answer key questions about the financial viability of the project. They include how much market rate housing would be needed to bankroll the redevelopment and how much in City Redevelopment funds would be pumped into the City-owned parking.

The financing issue was brought up near the start of the meeting by Council member Bobby Shriver, a vocal opponent of the condo towers.

"Can you fund it without the towers?" Shriver asked Macerich officials. "Isn't that really the eight-hundred pound gorilla in the room?"

"It doesn't make economic sense," Brant answered.

The three 300-foot-tall condo towers –- which had been a prominent feature in early displays of the project –- were barely visible in Tuesday’s presentation.

“We weren’t planning on showing those,” Brandt said when asked why the towers were lost in a mosaic of models during the computer presentation.

While the proposed project featuring the towers was the one originally showcased by Macerich, it was chosen after a dozen other configurations –- including one shaped like a prison –- were rejected by company officials, Brant said.

The different massing models and site plans attempt to fit in the 450 housing units and 100,000 square feet of office space okayed in concept by the council, the Promenade Uses Task Force and the Civic Center Working Group nearly two years ago.

“If they (the housing) can be configured differently, I’m totally open to that,” Brant said.

The other key direction came after Council member Ken Genser pushed for more community involvement, noting that the City and its residents had a large stake in the 10-acre project on one of Santa Monica’s premier sites.

“The City owns the land under the parking structures,” Genser said. “With that amount of public investment… why should we, the City and public, feel comfortable with Macerich making decisions about such an important site?”

“I’m totally open to that,” Brant responded.

Macerich presented an outreach plan that included extensively noticed community meetings with City and mall officials, displays at libraries and other public spaces that allow the public to comment on the proposal and a web site featuring the proposed redevelopment.

For the project to work, the public process will have to result in a development approved by the community that also pencils out, City and mall officials agreed.

“I think it’s a matter of finding out what the community wants to see on that ten-acre site,” Brant said after the meeting. “Obviously, it has to make economic sense for us and for the City.”

At the suggestion of City Manager Susan McCarthy, the council directed staff to make sure the process is “substantially expedited.”

“Have a clear and open process, but efficient,” MaCarthy said.

Macerich officials had urged the council to move quickly, noting that the mall's two department stores -- Macy's and Robinsons May –- have agreed to hold off on planned renovations.

“We have a window of opportunity right now, where they have agreed to do something they have not done anywhere in the United States, which is to shut down for two years,” said Macerich CEO Art Coppola.

If the anchor stores –- which have long-term leases that do not require them to pay rent -– don’t see quick action, Coppola warned, “They will then put money back into the stores and our opportunity would be lost.”

Tuesday’s vote came after testimony from nearly 30 members of the public, including three former mayors.

“This project will be exclusive, upscale and certainly not human scale,” said former mayor Denny Zane. “It will not be recognizable as Santa Monica.”

Former mayor Michael Feinstein, a vocal supporter of moving forward with negotiations, cautioned the council not to “self-eviscerate ourselves in a fit of paranoia and fear” or get caught up in a “rhetorical hang up over what the starting point should be.”

Some opponents said the proposed redevelopment had caused widespread community concern.

A survey by Friends of Sunset Park found that 30 respondents approved of the project, although many had reservations, while 150 opposed it, said Zina Josephs, president of the neighborhood group.

“That’s five to one against the current proposal,” she said.

Planning Commissioners also opposed moving forward with negotiations and urged the council to wait until the City updates its general plan, which dictates development.

“I don’t see any principled basis on which you can direct staff to proceed,” said Planning Commission Chair Barbara Brown. “All negotiations now will start with this particular project.”

Bayside officials, as well as Downtown property owners and realtors urged the council to move forward with the much-needed redevelopment of the 25-year-old mall.

“It’s a dinosaur,” said Bayside District executive Director Kathleen Rawson, noting that she was speaking for herself and not the Bayside board, which has not taken a position. “We shouldn’t hold the process up.

“Macerich should move forward,” Rawson said. “You should move forward.”

“Santa Monica Place needs to change,” said Barbara Tenzer, a Downtown realtor. “This is a golden opportunity. Keep the process open.”

After the final vote, some opponents of the project celebrated the result.

“This is no longer a private project that is seeking City approval,” said former mayor Paul Rosenstein. “It is becoming a public/private partnership where the City is an integral partner."

Council member Kevin McKeown -- who had declared the project D.O.A. (dead on arrival) -- welcomed the new start.

“I have a new respect for Macerich based on their willingness to start afresh,” McKeown said before casting his vote. “I think there is a community sense that we can do better.”

The community discussion of the project will benefit the two-year process to update the City’s general plan, McKeown contended.

“What better than to have an actual project to think these things through,” he said.