Bernard C. Parks · @bernardcparks
25th Jan 2011 from Twitter for iPhone
PARKS PULLS MARLTON SQUARE OUT OF BANKRUPTCY Demolition to Begin Shortly on the former Santa Barbara Plaza, Construction to Restart on Buckingham Place Senior Apartments
LOS ANGELES - Councilmember Bernard C. Parks joined business leaders
from across the Eighth District to announce that problem-plagued
Marlton Square has emerged from bankruptcy, with a final settlement
reached on December 29th, 2010.
“To say I’m thrilled would be the understatement of the decade,” Parks
said. “This blighted property has been an eyesore in the community for
years. I share the anger and frustration of my constituents at the
incompetence and financial mismanagement of past government officials
and real estate developers that created this mess.”
Commercial Mortgage Managers (CMM) was selected to act as the
servicing agent for over 270 claimants on the parcels in the south and
west portions of Marlton Square, which have been mired in bankruptcy
litigation for several years. The company plans to raise capital for
demolition of the existing structures, which have become a magnet for
crime, and then sell the entire property on behalf of the claimants,
to a qualified developer.
The only portion of the planned mixed-use development – which was to
offer stores, restaurants and market-rate condominiums – that ever
commenced construction was Buckingham Place Senior Apartments,
envisioned as a three building complex with 180 apartments for
low-income seniors. Only one of the three buildings was constructed,
but work was ordered stopped when at least three companies forced the
property in to involuntary Chapter 7 bankruptcy, after the developer
stopped making payments to construction companies in May of 2007.
The building is over 90% complete, with appliances, carpeting and
cabinets already in place, with work remaining to be completed in the
hallways, stairwells and trash rooms. In 2010, the City signed a new
contract with Meta Housing to complete the project. Construction will
commence pending approval from the US Department of Housing and Urban
Development, which had provided $8.5 million in federal funding, and
is expected to create over 65 jobs.
“This community has been promised redevelopment of Marlton Square time
and time again, only to be let down by failure after failure. I’m not
going to insult my constituents by making more promises,” Parks said.
“They don’t want more promises, they want action.”
Many in the business community think Parks may just have the
leadership ability, clout and fortitude to succeed where so many
others have failed. He was joined at the Tuesday morning press
conference by a wide variety of business and community leaders,
including: Christine Essel, CEO of the Community Redevelopment Agency
of Los Angeles (CRA/LA), Carolyn Hull – Regional Administrator for
CRA/LA’s South Los Angeles Region, Mike Jones – President of the
Crenshaw Chamber of Commerce, Ken Lombard – President of Capri Urban
Partners (which owns neighboring Baldwin Hills Crenshaw Plaza Mall),
Curtis Fralin-Owner, Mavericks Flat, Walter Cathey – Regional Real
Estate Director for Fresh & Easy, Karim Webb & Edward Barnett –
Franchisees of a new Buffalo Wild Wings restaurant, Brad Johnson,
restaurateur and developer of the future Post and Beam Restaurant,
Lori Johnson – Vice President, Portfolio Leasing for the Festival
Companies and real estate broker Darren Gooden of Bedford Parc.
Their comments suggested a general consensus that Parks understands
the needs of the business community and his commitment to creating a
friendly business environment has led to the recent development boom
in the Crenshaw District.
Capri Urban Partners is investing $30 million into upgrading Baldwin
Hills Crenshaw Plaza, with an eye toward attracting high-end tenants,
as well as investing $10 million into the Magic Theatres next door.
Rave Motion Pictures will operate the renovated theater, which will
feature stadium seating and the latest digital technology, which can
project in 3-D.
Fresh & Easy won City Council approval for a new, 10,000 sq foot store
on Crenshaw and 52nd – the first full-service grocery store to open in
the Eighth District in over 25 years.
Historic Mavrick’s Flat, once the premier R&B club of the west coast
that hosted the likes of Ike & Tina Turner, Marvin Gaye and Chaka
Khan, has undergone an extensive multi-million dollar renovation,
having been returned to its former glory by owner Curtis Fralin.
Parks’ office provided over $650,000 in Community Development Block
Grant money for the project. Over 50 jobs will be created.
Over $2 million was invested in the soon to open Buffalo Wild Wings,
with over 120 permanent jobs created, the majority of which will be
local-hire.
Restaurateur Brad Johnson is planning an upscale sit-down family
restaurant that is expected to create dozens of construction and
permanent jobs.
The MTA’s planned Crenshaw Light Rail Line will likely spur further
development in the area, as well as planned improvements as part of
the Crenshaw Visioning Project. $14 million in prop 1C funds will
provide street and sidewalk lighting improvements, streetscape
improvements, new bus shelters, bike racks, street benches and trash
receptacles.
The sordid history of Marlton Square goes as far back as 1984, when
Mayor Tom Bradley first called for redevelopment of the shopping
center then known as Santa Barbara Plaza. Former LA
Laker-turned-businessman and entrepreneur Magic Johnson won the
exclusive right to negotiate in 1996, but lost the deal to a
development group that included football star Keyshawn Johnson.
Johnson’s company, with partner Chris Hammond – Capital Vision
Equities – defaulted on the project in 2004. To further complicate
matters, Capital Vision’s bank itself went bankrupt in 2006. The Las
Vegas-based USA Capital, had loaned Capital Vision Equities $36
million to buy up the approximately 50 parcels of land that made up
the project. When USA Capital dissolved, it became the largest company
in Nevada history to go bankrupt, leaving a mess of $962 million in
assets, and more than $6,000 investors.
Following Governor Jerry Brown’s recent proposal to eliminate
community redevelopment agencies statewide, the CRA/LA have come under
intense scrutiny.
“The importance of the CRA is reflected in the last five years of
progress,” Parks said. “If it weren’t for CRA we wouldn’t be standing
here today.”
“Although I believe Magic Johnson Development Corp would have
completed the project had the city, the CRA and previous councilmember
supported their efforts, even they were experiencing difficulty
gaining control of the numerous parcels of land, negotiating with over
40 owners and over 300 businesses and tenants.
“Those that work in the public sector, often fail to comprehend that
for a business, time equals money.
“While we have been waiting for the bankruptcy process to work through
the system, the CRA under its current management, purchased nearly all
of the remaining parcels, which will allow the new owner to negotiate
and work with one party, greatly simplifying matters.”
Parks also added that the assistance of the CRA/LA was invaluable in
creating many of the new businesses in the area.
When asked to comment on what he believes the proper relationship
between business and government should be, Parks replied,
“It’s all about jobs. Government should create the conditions for
businesses to thrive, so people can get jobs, make an income, which
they will in turn spend, generating more economic activity, and
ultimately more tax revenue for the city. I believe they call that the
‘multiplier effect’. I think people forget that government exists to
serve the people; not the other way around.”