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Housing, Community & Community Redevelopment Agency of the CITY OF LOS ANGELES CRA/LA Building communities with jobs & housing DATE I DEC 18 2008 FILE CODE I 354 South Spring Street I Suite 800 T 213 977 1600 IF 213 977 1665 Los Angeles I California 90013-1258 www.crala.org CRA File No. Bq$ Council District: CD8 Contact Person: Alvin jenkins (213) 977-2640 Honorable Council of the City of Los Angeles John Ferraro Council Chamber 200 N. Spring Street Room 340, City Hall Los Angeles, CA. 90012 Attention: Alan Alietti, Office of the City Clerk COUNCIL TRANSMITTAL: Transmitted herewith, is a Board Memorandum adopted by the Agency Board on 12/18/08, for City Council review and approval in accordance with the "Community Redevelopment Agency Oversight Ordinance" entitled: VARIOUS ACTIONS RELATED TO: EXPENDITURE OF UP TO $1,000,000 FROM CRA/LA LAND ACQUISITION FUND FOR ACQUISITION-RELATED EXPENSES FOR MARLTON SQUARE RETAIL AREA PROPERTIES, LOCATED IN SANTA BARBARA PLAZA IN THE AMENDED CRENSHAW REDEVELOPMENT PROJECT AREA SOUTH LOS ANGELES REGION (CD8) RECOMMENDATION That City Council approve(s) recommendation(s) on the attached Board Memorandum. E.NVIRONMENTAL REVIEW The recommended action does not constitute a project as defined by the California Environmental Quality Act ("CEQA"). Development of all properties within the retail area of the Marlton Square Project were included in the proposed Marlton Square Development Initial Study and Mitigated Negative Declaration, which was adopted by the Board on August 1, 2002. FISCAL IMPACT STATEMENT There is no fiscal impact to the City's General Fund, as a result of this action. cc: Karen Kalfayan, Office of the City .Clerk (Original·& 3 Copies on 3-hole punch) Lisa Johnson Smith, Office of the CAO lvania Sobalvarro, Office of the CLA HOUSING, COMMUNITY & ECONOMIC Q~V~LOPMENT ·~ DEC 2 2 2005 Helmi Hisserich, Office of the Mayor Noreen Vincent, Office of the City Attorney THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF LOS ANGELES, CALIFORNIA MEMORANDUM 14 DATE: DECEMBER 18, 2008 CR2140 TO: CRA/LA BOARD OF COMMISSIONERS FROM: CECILIA V. ESTOLANO, CHIEF EXECUTIVE OFFICER RESPONSIBLE PARTIES: CAROLYN HULL, REGIONAL ADMINISTRATOR ALVIN JENKINS, PROJECT MANAGER SUBJECT: EXPENDITURE OF ·UP TO $1 ,000,000 FROM CRA/LA LAND ACQUISITION FUND FOR ACQUISITION-RELATED EXPENSES FOR MARLTON SQUARE RETAIL AREA PROPERTIES, LOCATED IN SANTA BARBARA PLAZA IN THE AMENDED CRENSHAW REDEVELOPMENT PROJECT AREA SOUTH LOS ANGELES REGION (CDS) RECOMMENDATION That the CRA/LA Board of Commissioners ("Board"), subject to City Council review and approval, amend the FY09 Budget and Work Program to authorize the expenditure of $1 ,000,000 from the CRA/LA Land Acquisition Fund to pay for CRA/LA purchase options and other acquisition related expenses for specified properties within the retail area of the Marlton Square Retail Project located on Martin Luther King, Jr. Boulevard and Marlton Avenue in the Amended Crenshaw Redevelopment Project Area ("Project Area"). SUMMARY Acquisition Related Expenses There are eight {8) properties within the retail area of the 22-acre Marlton Square mixed-use developmer;t project ("Marlton Square Project"). Of these eight, one (1) property is owned by CRA/LA (the Swap Meet property), one (1) owner is currently investigating the potential of being part of the Project, thus his property is not being considered for purchase (the Jerry's Flying Fox property), two (2) are in escrow for purchase by CRA/LA (the Exceptional Children's Foundation "ECF" and Maranatha properties), and the remaining four (4) properties will be . offered purchase options by CRA/LA (the Option properties) using the Land Acquisition Fund. (See Properties List section below). CRA/LA staff recommends the expenditure of up to $1 ,000,000 for acquisition of the Option Properties (which it considers opportunity sites) and for acquisition-related expenses. These expenditures are anticipated to include approximately .$600,000 for purchase options on the Options properties, with the remaining $400,000 used for tenant relocations, transactional costs and acquisition related contingencies. Staff intends to use all eight (8) properties for retail area redevelopment consistent with the objectives of the Amended Crenshaw Redevelopment Plan ("Redevelopment Plan") and with City zoning rules for retail uses. (See the eight (8) properties on the Location and Site Map, Attachment "A" hereto). Due to the limited amount of CRA/LA funds available for acquisitions, staff intends to extend offers for ( . ( AUTHORIZED EXPEND11 LIRE OF LAND ACQUISITION FUND '··- 2 purchase options to the owners of the Option properties. These owners have already indicated their desire to sell, but to date, no purchase option terms have been negotiated for the Option properties. (See items 1-4 in the Properties List section below.) Other acquisition related expenses, including relocation, transactional and related contingencies, may relate to any of the properties listed as items 1 -8 in the Properties List section below. Properties List The address and ownership of each ofthe eight (8) retail area properties are listed below. The Option properties are marked with an asterisk(*): 1. * 3742 Martin Luther King, Jr. Boulevard, owned ~y Oran Belgrave; 2. * 3760-72 Martin Luther King, Jr. Boulevard, owned by Henry T. Jacobs and Lynn E.G. Jacobs; 3. * 4023-4029 Marlton Avenue, owned by Harry M. Koplan; 4. * 3710-18 Martin Luther King, Jr. Boulevard, owned by Glenn & Corinne Buchanan Trust; 5. 3724-3732 Martin Luther King Jr. Boulevard, owned by Jerry Edwards (Jerry's Flying Fox). This property is not being considered for purchase at this time, due to the owner's wish to investigate opportunities for participating in the future retail area development; 6. 3750 Martin Luther King, Jr. Boulevard, owned by Exceptional Children's Foundation ("ECF"), currently in escrow with CRA/LA; 7. 3800 Martin Luther King, Jr. Boulevard, owned by Maranatha Community Church, currently in escrow with CRA/LA; and 8. 3700 Martfn Luther King, Jr. Boulevard and 4023 Marlton Avenue, Swap Meet property owned by CRA/LA. Recommended Conditions for Acquisition All purchase offers, purchase options and acquisition negotiations for properties will be based on appraisals and CRA/LA-adopted policies. Offers will have an expiration date of not more than 30 days from Board and/or City Council approval or from issuance of a purchase option letter, whichever is later. Offers would be extended at the discretion of CRA/LA's Chief Executive Officer or designee. CRA/LA closing of acquisition of each Option property is subject to completion of a Phase I environmental investigation on the property. Redevelopment Plan Objectives Achieved The proposed acquisition and redevelopment of the Option properties will implement several Redevelopment Plan objectives. First, the development of a retail center on these properties will implement the Plan's objective of improving the Project Area's physical and economic environment, as well as promoting a positive image of the Area. Second, the proposed retail center will implement the Plan's economic development objective by providing needed retail shopping opportunities, as well as providing new construction and permanent jobs for the Project Area. Third, the proposed retail center will help eliminate blight on all eight (8) properties by transforming them into an attractive commercial center which is part of the overall Marlton Square Project. AUTHORIZED EXPENDII uRE OF LAND ACQUISITION FUND 3 July 17, 2008 -Agency approval to negotiate and execute a Cooperation Agreement with City of Los Angeles for $21,875,000 for Marlton Square Acquisition and Predevelopment Activities. February 12, 2008 - Agency approval to acquire two parcels located at 3700 Martin Luther King, Jr. Boulevard and 4013 Marlton Avenue from Discount Security Storage for an amount not to exceed $5,250,000. SOURCE OF FUNDS CRA/LA Land Acquisition. PROGRAM AND BUDGET IMPACT Approval of the recommended amendment of the FY09 Work Program and Budget will result in sufficient funds to cover the cost of the recommended acquisition related costs in the appropriate budget line item. The $1 ,000,000 from CRA/LA's Land Acquisition Fund will be used for purchase options for up to four (4) retail properties for an estimated $600,000, in addition to an estimated $400,000 for tenant relocations on purchased properties and for transactional costs and acquisition contingencies. ENVIRONMENTAL REVIEW The recommended action does not constitute a project as defined by the California· Environmental Quality Act ("CEQA"). Development of all properties within the retail area of the Marlton Square Project were included in the proposed Marlton Square Development Initial Study and Mitigated Negative Declaration, which was adopted by the Board on August 1, 2002. BACKGROUND CRA/LA staff, consistent with direction from the Board, has been seeking creative ways to acquire property in the retail area of the Marlton Square Project through negotiated sales transactions, as well as seeking purchase options for those properties that CRA/LA does not currently have sufficient funds to acquire. Earlier this year, CRA/LA closed escrow on its purchase ot the first of the privately owned retail area properties (the Swap Meet property) using $5,000,000 from the Land Acquisition Fund. CRA/LA staff more recently recommended a retail area land acquisition plan to the Board on July 17, 2008. That plan was to aggressively pursue property acquisition, as well as seek ways to fund purchase options on the other retail properties. Since that time, staff has entered into escrow on two additional properties to be funded by previously allocated HUD funds that were set aside for Marlton Square retail area property acquisitions. The two properties now in escrow are the Exceptional Children's Foundation and Maranatha Church. The retail area properties consist of several parcels, most of which are currently being used as retail/office businesses. These properties are zoned (Q)-C2-2D and the Redevelopment Plan designates them for Regional Center uses.
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