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La Entrada in 2011

Paul Wellman

La Entrada in 2011

Yet More Changes Proposed for La Entrada

New Developer Asks to Redesign Long-Festering Hole in Ground

Thursday, October 4, 2012
By Nick Welsh (Contact)

Just as it seemed that actual work crews might soon descend upon the longest running hole-in-the-ground and non-construction site within city limits ​— ​11 years now unbuilt ​— ​the new owner of the proposed La Entrada development has asked City Hall to consider major changes to the design and timing of his plans to build a unified, if sprawling, private redevelopment project with 119 hotel rooms, nine time-share condos, 16,500 square feet of shops and restaurants, and 243 parking spaces on three city blocks located toward the bottom of State Street. La Entrada, first proposed in the 1990s, secured its final approvals in 2001 but never got built because of financial challenges ​— ​some self-inflicted ​— ​afflicting its first two owners.

After exhausting all possible permit extensions, developers approached City Hall two years ago with major design revisions. City Administrator Jim Armstrong, exasperated that such potentially lucrative real estate had become a long-festering blight, insisted on a sequential series of strict construction deadlines in exchange for his approval. But just last week, agents of developer Michael Rosenfeld ​— ​who bought the massive project last January for nearly $8 million ​— ​submitted a written request asking that Armstrong grant permission to reconfigure some of the larger parts of his jigsaw puzzle.

Doug Fell
Click to enlarge photo

Paul Wellman

Doug Fell

In addition, Rosenfeld asked that Armstrong suspend the deadline sequence requiring that parking and street improvements be built first and that hotel rooms and shops be built afterward. Rosenfeld’s land-use attorney Doug Fell argued the project would be “more economically viable” if Rosenfeld were allowed to build hotel rooms at the same time as the new parking lot. By proceeding simultaneously, he argued, the project could begin generating income much sooner than under the deal negotiated with Armstrong two years ago. Fell, it turned out, negotiated that deal, too.

Back then, one of Fell’s strongest pitches was that the developer ​— ​then Mountain Funding, a lending institution specializing in high-risk ventures and troubled developers ​— ​would dramatically expand the sweep and size of a public plaza, across the street from the Californian Hotel, that would open out onto State Street and invite passersby. But under the new plans, that public plaza would be reduced significantly in size, and it would no longer open to State Street at all but onto Mason Street instead.

Fell insisted this change was consistent with criticisms of the project leveled by the Historic Landmarks Committee, the members of which never embraced the big plaza. With shops facing State Street directly, Fell said the project would feel and function like the rest of State Street. And mountain views, he insisted, would be preserved under the proposed changes except from a small number of vantage points.

In addition, Rosenfeld has proposed moving all but eight of the parking spaces ​— ​both above ground and below ​— ​to the parcel across State Street from the Californian Hotel; previously they had been spread out on all three parcels. In addition, he wants to move all the hotel rooms to the Californian Hotel and an adjoining parcel where what’s left of Bebop Burgers still stands.

Procedurally, the redesign request is both awkward and unprecedented, involving so large a project so many years after the initial approvals were issued. Nor does it help that City Hall believes that previous developers played a strategic game of cat-and-mouse at the public’s expense, always promising construction was right around the corner but never doing more than the bare minimum needed to keep their permits alive. Rosenfeld ​— ​who spent $2 million this year on the surgical demolition of the Californian that left only the hotel facade standing ​— ​does not suffer from this reputation. In fact, this Monday, he pulled permits, at a cost of $50,000, to begin the sidewalk widening work on the west side of State Street.

By Paul Wellman

Californian Hotel façade

But Fell also acknowledged that he will be asking Armstrong to stop the clock on Rosenfeld’s deadlines while this proposal is under review. Typically, it would be up to Community Development Director Paul Casey to determine whether these new proposed changes “substantially conform” to the project that had been reviewed and approved by the city’s planning commission and city council 12 years ago.

But because Casey has a relative working for the developer’s architect, the decision falls to Armstrong, an administrator rather than a land-use planner. Armstrong declined to comment on the proposal, but it’s all but certain he would allow the Planning Commission to weigh in ​— ​as he did two years ago ​— ​before rendering any decision. As a practical and political matter, Rosenfeld, a Los Angeles developer now building twin towers 46 stories tall behind the iconic Century Plaza hotel, holds the trump cards.

Armstrong and the City Council want the three-block project built, the blight removed, and the revenues ​— ​bed taxes and sales taxes ​— ​to begin pouring in. While Armstrong has the power to say no, and to let Rosenfeld’s permits expire, he can’t compel the developer to actually build. But Armstrong might be able to negotiate a more accelerated construction completion date than the 2016 deadline now on the books.

Given the long history of delays dogging this project, neighboring business owner Tony Romasanta ​— ​who owns the Harbor View hotel ​— ​has expressed considerable vexation that Rosenfeld is seeking to change the terms of his deal. Romasanta has expressed serious doubt over the years whether the project is, in fact, economically viable and has urged City Hall to pull the plug and begin the painful process of starting over. “We hear Rosenfeld has deep pockets and owns a lot of hotels,” he said, “but we were told that Mountain Funding sat on $4 billion, and they couldn’t build it, and we were told that Billy Levy could move mountains with the wave a wand, but he couldn’t build it, either.”

Fell, who has sparred with Romasanta over the years, insisted that the project is economically viable and noted Rosenfeld has complied with every city deadline since acquiring control of the project, sinking $4 million into it. “This is a better project,” he said. “It’s worth getting right.”

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