Los Angeles Business Journal

Santa Monica’s New Direction?

DEVELOPMENT: City mulls project for east of Promenade. By Jacquelyn Ryan Monday, August 19, 2013

The proposal includes 1,220 parking spaces, nearly half of which will be available to the public. The developer said the project would generate $1.3 million a year in income for the city from a ground lease.

The most noteworthy feature of the project, Harris said, is the design. The tower would be built by stacking each component in rectangular shapes at what appears to be alternating angles, providing ample open outdoor space at each level.

It also has committed nearly $900,000 to community activities through a yet-to-be-created management group. The activities would include yoga classes, lectures and concerts as well as the rink.

“The open space was critical in our review,” Harris said. “We liked how the physical improvements interacted to the open space. … I would say the design aspects – the open space and the site planning – are what put this project over the top.”

Other proposals

The Metropolitan Pacific plan was recommended over the Forest City and Related California proposals, which both included outdoor space and accommodations for an ice-skating rink.

Forest City proposed building a $226 million project comprising two separate structures – one for a 213,000-square-foot office building and another for a 144,000-square-foot residential building for 175 apartments. Both would include ground-floor space for cultural, educational and workshop uses. It would include 508 private parking spaces and 339 for the public. Forest City proposed a $1.75 million-a-year ground lease to the city plus 20 percent of the cash flow after a 12 percent developer return.

Meanwhile, Related California proposed a $270 million residential-office development that included ground-floor shops. The total 484,000-square-foot development would include 146,500 square feet of office and 248,000 square feet of residential space for 260 apartments. It would have stood 19 stories tall at its highest point. It included a dining terrace and community art space as well. It called for 339 public parking spaces, 507 shared spaces and 367 for residents. It suggested an upfront capitalized $33.2 million ground lease to the city.

The City Council is slated to choose a developer for the site Aug. 27. The city can then begin negotiating a contract with the developer. The developer can also begin the process of community input and entitlement applications.

The existing banks’ leases expire in 2022 and 2026. It would be the developer’s responsibility to move the banks or strike a deal to move them into the project when it’s built.

Once approved, the project could take as long as three years to build. Harris estimates that the project could be finished by 2019.

“It’s a milestone,” he said. “It’s pretty representative of where Santa Monica is at. We are very diligent and thorough in our architectural work.”

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