Zuma Dogg's BIGGEST "I TOLD YOU SO EVER" -- Board of County Supervisor Antonovich Says, "Grand Ave Project Should Be Abandoned"

First of all, I hope my former editor is reading this, because when I was researching the Grand Avenue Project, and I said, "This thing is never gonna get off the ground -- and I see there is pension money invested," I was told, "Oh Zuma...of course it's going to be built, although maybe scaled back -- everything is a conspiracy with you. And don't focus on the pension money...there is a tree next to the Board of Supervisors building that will be cut down that workers like to each a bagged lunch under, and they'll lose that. YOU HAVE TO BE KIDDING!!!!

SO FIRST OF ALL, I DISCOVERED L.A. CITY PENSIONGATE BASED ON THIS PROJECT, EVEN THOUGH I WAS TOLD NOT TO WRITE ABOUT THAT (too boring) -- ALTHOUGH THE CITY HAS ALL BUT TO THROW IN THE TOWEL AND DECLARE BANKRUPTCY OVER PENSION LOSSES...AND NOW...THIS!!! (Aka: STILL not off the ground...and now calls to "pull the plug," on this turkey of a loser project that offered NOTHING anyone needed except Eli Broad's wife and all her billionaire friends. SO PLEASE COLLECT THE $250,000 A MONTH LATE FEE THAT THE GRAND AVE PROJECT DEVELOPERS OWE THE CITY THAT GLORIA MOLINA IS SCARED TO COLLECT BECAUSE THE DEVELOPERS MIGHT PULL OUT...

FUCK THAT YOU FOOL...WE WANT TO KICK THEM OUT...TAKE THE FUCKING $250,000 A MONTH THEY OWE THE CITY -- AND GET THE RETRO PAYMENTS...

YOU, GLORIA MOLINA...I AM SPEAKING DIRECTLY TO YOU, YOU BILLIONAIRE DEVELOPER PROTECTOR...

HEY MOLINA...HEY DUMSLOBSKY...HAVEN'T YOU HEARD...THE CITY AND COUNTY IS UP SHIT'S CREEK, BECAUSE YOU ASSHOLES PUT US THERE...COLLECT THE $250,000 FROM RELATED, OR I'LL BE SHOWING UP IN PERSON TO BLAST IT ON TV, AND IF YOU EVEN WHINCE TOO HARD WHEN I AM SPEAKING I'LL SUE YOU INTO COUNTY BANKRUPTCY.

COLLECT THE MONEY YOU STUPIDVISOR CLOWNS!!! WITTE'S RELATED COS (short for ClOwnS) OWES $250,000 A MONTH FOR TYING UP THE MOST VALUABLE PROPERTY IN THE CITY THAT ZUMA DOGG TOLD HIS BIG SHOT, BIG MOUTH EDITOR THAT IT WOULD NEVER GET OFF THE GROUND, AND THREE YEARS LATER IT HASN'T.

NO APOLOGY NEEDED...BUT PEOPLE SHOULD HAVE HEARD HOW I WAS BELITTLED AND DEGRADED FOR MY OPINION THAT WAS CORRECT. Could have just said you didn't agree. BUT IF YOU ARE GOING TO BE ARROGANT AND FLIPPANT TO ZUMA DOGG, YOU BETTER BE FUCKING RIGHT, NOT 100%, COMPLETELY WRONG ABOUT EVERYTHING!

Dubai? No, Condo Glut’s Stalling Grand Avenue

DEVELOPMENT: Doubts about financing add to real estate project’s problems.

By JOEL RUSSELL

Los Angeles Business Journal Staff

Downtown L.A.’s $2.7 billion Grand Avenue urban renewal project won’t be affected by the financial troubles of its main backer in Dubai. That’s because the project is going nowhere fast. The real question is: Will it ever happen at all?

The problem is not just the funding – it’s also the precipitous decline in the downtown condo market.

“The project should be abandoned,” said Paul Novak, land planning deputy for Los Angeles County Supervisor Mike Antonovich, the project’s most outspoken critic. “We need to rethink what goes on that land and how the county and city can maximize their returns. But it’s not this deal. We should probably start from scratch and issue a new request for proposals.”

Last week, Dubai World announced it would suspend scheduled debt payments while it restructures half of its $59 billion debt. In 2008, Istithmar World, a subsidiary of Dubai World, invested $100 million in Grand Avenue, a mixed-use project planned near Walt Disney Concert Hall. Istithmar isn’t affected, as it’s reported to be on stable financial footing.

Bill Witte, president of the California division of Related Cos., the Grand Avenue developer, said there was no fixed date to start construction on the project’s first phase, which includes 390 luxury condos, 98 rental apartments and 250,000 square feet of retail space.

“We are in the middle of a deep real estate recession, so we are not about to start,” Witte told the Business Journal. “You couldn’t build a 40-unit condo project in this market. So why would anyone think we would be ready to start now?”

But Witte said Grand Avenue will be built. The land is paid for, all plans have been completed, permits are in hand and Related will begin construction of a park in the summer.

But Novak estimates that phase one will require close to $1 billion. Meanwhile, the developer has only about half that amount secured.

“Where you’re going to find half-a-billion dollars in this market is beyond me,” he said.

Since phase one of the project was approved by the Grand Avenue Authority in February 2008, the downtown condo market has continued to retract. Major downtown developers, including Meruelo Maddox Properties and Namco Capital, have declared bankruptcy. And in early 2010, the Ritz-Carlton Residences near the Staples Center, built by Anschutz Entertainment Group, will flood the market with 224 luxury units. {ZD warned council of the Meruelo-Maddox bankruptcy all this past year before it happened, toward the goal of being able to prepare for it, which they never do.]

Brad Luster, president of downtown brokerage Major Properties, estimated that it would take seven years for the downtown market to absorb the condos in the Grand Avenue project.

“The present economics aren’t supporting new projects,” he said. “Right now there are four projects near LA Live that are in foreclosure or bankruptcy, and there’s a still a long way to go down.”

However, Gerry Hertzberg, policy director for County Supervisor Gloria Molina, chairwoman of the Grand Avenue Authority, said there is no intent to abandon or change the project’s plans.

Zuma MusicRadio 6 - Random Hits "A-Z" (Pt 1) 50 songs

Zuma MusicRadio 7 - Random Hits "A-Z" (Pt 2) 50 songs

All Zuma MusicRadio Playlists at http://ZumaDogg.org
(Poor Man's XM/Sirrius)

LA WEEKLY ARTICLE: Los Angeles Corporate Welfare: Ritz-Carlton and AEG Rich entities siphon taxpayer money while real communities struggle

Published on October 07, 2009

• South Central Neighborhood Council budget expert Daymond R. Johnson: Less than impressed by the new, luxury, taxpayer-subsidized Ritz-Carlton

Los Angeles Corporate Welfare: Ritz-Carlton and AEG

Rich entities siphon taxpayer money while real communities struggle

By Tibby Rothman

(Yea, Tibby!)

EXCERPTS:

...A thin, shimmering downtown tower, 54 stories high, wrapped in tints of blue, the nearly completed Ritz-Carlton Hotel & Residences and JW Marriott at L.A. Live. A short walk from Staples Center and the L.A. Convention Center, downtown’s newest asset is set to open in February 2010. From the days of Mayor Tom Bradley and through the years of his successors, Richard Riordan, James Hahn and Antonio Villaraigosa, L.A.’s political elite and city boosters have lobbied for what the Ritz-Carlton and its surrounding enclave embody: a long-sought luxury hotel for conventioneers, a centralized city, a populated downtown more like Manhattan.

L.A. Live is set to flourish, but the city is falling apart.

“I call it environmental racism,” says Daymond R. Johnson of South Los Angeles. “The streets leading into downtown have always been taken care of, but as you cross the 10 freeway and come south of downtown L.A., you begin to see the difference in the environment.”

“Environmental racism” might seem like hyperbole, but Johnson is a thoughtful neighborhood council member named by the California Democratic Party as Democrat of the Year for Assembly District 48. Johnson has represented the South Central Neighborhood Council on budget matters for the last six years. He works as a safety officer at a respected charter school.

He says that even such simple quality-of-life services as the synchronization of streetlights are handled differently in West L.A. than in his own neighborhood. Thanks to those double standards, he claims, “My neighborhood council area is one of the most deprived in the city of Los Angeles.”

Johnson, who lives in Councilmember Jan Perry’s district, notes that sectors of the city that have been starved, like South L.A., felt the budget pain long before any recession hit: “There was never a lot of attention to the area — so it would be an understatement to say that there have been cuts.”

Yet the city has, and is, aggressively pouring money elsewhere. Beginning with a deal signed on October 31, 1997, City Hall lavished millions of dollars in subsidies and tax credits on companies owned by Denver-based billionaire Philip Anschutz to fund the politicians’ downtown dream. City officials forced the poor out of 27 “blighted” acres of downtown around Figueroa Boulevard and replaced the aging neighborhood with lucrative ventures.

Although AEG’s Staples Center/Ritz-Carlton/L.A. Live endeavor will pay increased property taxes and sales taxes thanks to an expected growth in visitors to the area and its upscale hotels, L.A. taxpayers, who have poured so much of their public money into the deals, will not recoup the revenue from the lucrative hotel bed tax for 25 years. Thanks to agreements City Hall made with companies controlled by Anschutz, the 69-year-old recluse will keep pocketing these “bed” taxes — money that would normally flow to city coffers — until he is 95 years old and Villaraigosa and the City Council are long out of office.

A city-solicited study once boasted that taxpayers would reap $1.7 million annually from the bed taxes; in fact, Anschutz will see the first $62 million.

Moreover, instead of requiring the wealthy developer to secure private financing for the 27-acre project encompassing Staples, the Ritz-Carlton and L.A. Live, the city — meaning the Los Angeles public — provided an Anschutz company a $70 million, 25-year loan, which is being repaid on a yearly basis through Staples ticket sales.

Anschutz will not pay off that $70 million loan provided by L.A. taxpayers until 2025, yet public documents filed with the Los Angeles County Recorder’s office reveal that an Anschutz company has already sold off three significant parcels within the project area.

AEG took the revenue from the resale of the three parcels, a transaction allowed by the redevelopment agency, and then the city shifted the planned projects on that land over to new owners. Yet at least one of those key parcels contained lots seized by the Community Redevelopment Agency from a private owner, using the eminent domain statute, purportedly to fight “blight.”

The eminent domain takings in the area of what is now Staples and L.A. Live in the 1990s left many private landowners deeply embittered over being forced off their property at “market/fair value.” City Hall’s recent decision to let AEG sell seized lands means “they ‘flipped’ the property,” declares Marko Mlikotin, president of the California Alliance to Protect Private Property Rights. He calls the resale by private developers of lands taken via eminent domain “egregious.”

“The CRA was using public dollars to seize private properties. Shouldn’t that property revert to the original owner?” he asks.

It is almost impossible to tabulate how much money Anschutz made off the resale. Eminent domain was used in some form to take 107 of 152 lots around Figueroa, which were then consolidated into a huge property.

“Taxpayers are subsidizing these projects, but then developers and brokers are making huge profits.”

Many political insiders see AEG, its president and CEO Tim Leiweke, and Anschutz as comprising a shadow government that continually persuades City Hall’s leaders to funnel public money to downtown, at the expense of South Los Angeles, the Eastside, the Valley and several other areas.

In fact, although the Los Angeles public is not aware of them, huge, additional subsidies are about to flow to the L.A. Live/Staples area. With a push from Villaraigosa and Perry, $50 million is being taken from the state Housing and Emergency Shelter Trust Fund of 2006, bonds approved by California voters to finance housing for battered women and the poor — or so voters thought. But in Los Angeles City Hall, the pols sought $50 million from the bond, a large chunk of which they plan to spend on sidewalk and street amenities to dress up Figueroa Boulevard downtown — which feeds directly into AEG’s publicly subsidized lands. [Remember ZD's, "Prop 1C money for Emergency Shelter For Battered Women, Children, Veterans and Disabled being used for the Grand Ave Project, commercial, cement park!?!?" Looks like since Grand Ave Project is on "hold" (LOL!) the money is being used for another commercial function.]

Mlikotin believes that “sound redevelopment projects don’t require developers to feed at the public trough or require eminent domain to create profitable business ventures. When public agencies continue to offer subsidies, why would any developer want to pay full market price, when they know that the local CRAs will provide taxpayer funding?”

SIDE BAR EXCERPT: "It generally does not concentrate huge profits, or tremendous political power, in the hands of one developer, like Anschutz — or the New York–based Related Companies, the chosen megadevelopers for the currently stalled luxury Grand Avenue hotel and shopping project."

Full Article from LA Weekly.com

Related Reading by Zuma Dogg...his greatest work ever, in his opinion, including uncovering pension money was invested in Grand Ave Project (CRA) and that it would never get off the ground, which it hasn't but I was told I was conspiratorial and crazy and that it WOULD get off the ground. That was over two years ago. Now it is referred to as "stalled."

Saturday, June 9, 2007

Downtown Los Angeles Presents: Eli' Broad, Related Co., CRA, City Council and County's GRAND AVENUE PROJECT (Planning Details and Project Review)

You may have heard of the nearly $2 Billion Downtown CRA mixed use project called, LA LIVE. (A Ritz Carlton Condo/Hotel, Marriott Hotel, PF Changs, Movie Theaters, Specialty Retail and open space. [If you are a rich billionaire visiting from Asia, you will love investing in this area! If you are a business or organization planning a convention near the convention center, well you better try Vegas, this will price the city right out of the ballpark!]

Plus a few other minor issues I am concerned about: Like the fact that there is no wat the City can be serious about thinking they can build another Universal City Walk Type project near Staples Center. They might be able to get some of it approved and built, but this is "pie-in-the-sky" fantasy land talk.

So just when you think there isn't enough demand for more five start hotels, luxury condos (instead of a range of affordable, middle and upper level residential housing for workers in the area), you forgot to factor in the fact that there is another OVER $2 billion five star hotel, luxury condo, specialy retail, restaurant and open space project to compete with the minimal demand. It's called...drumroll please...because it really deserves a prodigious, magestic, regal, fantastic, tribute of an introduction...

ELI BROAD & CORPORATE WELFARE FUNDSUCKERS INC'S...GRAND AVENUE PROJECT!!!

THE SAVIOR OF THE CITY, REGION AND WORLD!!! We are just lucky to have it. (Or at least have the approval to start spending the money!)

What if the project never even gets completed? With only phase one agreed to, and even that has not been executed, who’s to say people can’t drop out, default, or what if City money doesn’t come through?

See also:

Monday, June 11, 2007

VILLARAIGOSA UPDATE: AEG "LA LIVE" PROJECT: The Mayor's Attempt To Save Los Angeles with Five Star International Convention Center

ZumaReport.com

Aka: The "I Told You So Report" (Unless I Am Telling You.)

City Council Wants To Levy A NEW TAX For Grand Avenue Project

IF THIS DOESN'T MAKE YOU STAND UP AND RUN DOWN TO CITY HALL FOR PUBLIC COMMENT AND CALL FOR EVERY CITIZEN IN LOS ANGELES TO VOTE OUT EACH AND EVERY CITY COUNCILMEMBER...I DON'T KNOW WHAT WILL!!!

AFTER ALL THE SUBSIDIES AND TAX BREAKS VILLARAIGOSA AND CITY COUNCIL HAVE GIVEN BILLIONAIRE ELI BROAD, RELATED CO (ONE OF THE BIGGEST DEVELOPERS IN THE WORLD) AND THE ROYAL ARAB EMIRATE FAMILY OF DUBAI...

NOW THEY WANT TO LEVY TAXES FOR THE GRAND AVENUE PROJECT BONDOGGLE-BAMBOOZLE!!!

I HOPE LOS ANGELES CITY COUNCIL COLLECTS THE $250,000 PER MONTH LATE FEES THAT RELATED CO AND THE ROYAL ARAB FAMILY OF DUBAI OWE STARTING IN DECEMBER!!!

It's bad enough this Grand Avenue Project is getting money earmarked for Emergency Housing and Shelter for Battered Women and their children...YES, FIRST PROP 1C MONEY FOR BATTERED WOMEN AND SHELTER GOES TO GRAND AVENUE PROJECT...NOW A NEW TAX BEING LEVIED...AND ALL THE OTHER TAX BREAKS AND INCREMENT MONEY FROM THE CRA.

I KNOW A BUNCH OF PEOPLE GOING STRAIGHT TO HELL IN THE AFTER-LIFE...

VILLARAIGOSA (that criminal-behaving, home-wrecking, reporter-screwing douchebag of a dummy city wrecker) and the Uber-Dummy LA City Council A-holes who voted YES. (Bill Rosendahl the only "NO!")

ITEM NO. (8)

07-0332
CD 9
EXEMPTION, HOUSING, COMMUNITY AND ECONOMIC DEVELOPMENT COMMITTEE
REPORT and ORDINANCE FIRST CONSIDERATION, relative to the formation of City of Los
Angeles Community Taxing District No. 2 (Grand Avenue Project) and authorizing the levy of special tax within the District.

Recommendations for Council action, SUBJECT TO THE APPROVAL OF THE MAYOR:

In its report dated October 8, 2008, the City Attorney recommends that Council approve the recommendations listed above relative to the formation of City of Los Angeles Community Taxing District No. 2 (Grand Avenue Project) and authorizing the levy of a special tax within the District. If adopted, the Ordinance would enable but not require the City to authorize additional actions in the future, which could assist in the development of the Grand Avenue Project.

MAYOR ANTONIO VILLARAIGOSA...GOING DOWN IN HISTORY AS A DISGRACED CLOWN OF A DESPERATE MAN WHO BROKE UP HIS FAMILY, BROKE UP MIRTHALA'S CAREER AND BROKE UP THE CITY WITH HIS EGO, GREED AND STUPIDITY. AND THE SAD THING IS THE DAMAGE HAS BEEN DONE TO LOS ANGELES. I THINK KARMA FORCES ARE GOING TO DAMAGE ANTONIO!

Watch This Blog...

Wow...Friday was a day at City Hall as I have never seen. A couple issues slipped through City Council's cracks (maybe because someone was on crack) and they finally got a taste of what it's like to be bamboozled with a last-minute, legalese fastball (blown past them like 15 Hellen Kellers). The State Assembly Bill 212 (Fuentes), on it's way to the Senate, would allow developers to bypass council (on their way to the planning department) when in need of a zoning change to jam that skyscraper or golf resort up the communities wazoo.

Zuma Dogg explains it during public comment -- followed by alarCON (who mentions ZD). (Rick Orlov listening in bleachers.)

Here's a shallow Daily News article that can provide some surface background, but doesn't tell the real story, here.

AND YOU SHOULD HAVE SEEN WENDY SPIN AS THOUGH HER ENTIRE WORLD WAS RIDING ON IT! (I wish she would be this passionate over safety issues or the school system.)

What the Daily News didn't report, was that Zuma Dogg heard ASSemblymember Fuentes creates AB 212 as the cahoots-request of CMs Alarcon and Cardenas (and a third CM) to allow some kind of resort golf club development against CM Greuel's promises (to the Sunland-Tujunga community) to keep the development off the course.

But what ZD does not understand is why would alarCON and Cardenas have Fuentes create a Bill that takes away all their lobby/special interest magic powers. They'll be walking around the district like Clark Kent instead of Superman.

I think it's possible that ALARcon didn't think of this, or something, even though I find it hard to believe everyone involved wouldn't have thought of this as a side effect of this "one issue" Assembly Bill that was allegedly created specifically over a golf course in Sunland-Tujunga that some folks want to develop.

Looks like the boys forgot to cut Wendy in for her piece of the pie.

JAN PERRY VS DWP SOFTWARE NEEDS: Little Miss Thing, Despicable Human Being Jan Perry caused quite a ruckus over some "proprietary" software DWP wanted to purchase that Jan was concerned had an inside connection to the contract. (Even though it was proprietary software.) I've never seen such a scuttlebutt break out in the horse shoe with CMs on their cell phones and buzzing back and forth over the $1.475 million DWP software they need to purchase to allow their different systems to be able to communicate with each other (in helping to dispatch service calls, and whatnot.)

MAYOR THROWING GRAND AVE PROJECT UNDER THE BUS?: CM Bill Rosendahl was in the Daily News on Friday slamming the Grand Ave Project, "ZD Style" over subsidies. (I am about to read the article.) But I don't have to read the article for the REAL story on all of this...

ZD operates under the premise that CM Rosendahl is NOTHING but a Mayor Anotnio Puppet of the weakest kind. (He's the LEAST independent on the issues that matter to the mayor. HE WOULD NEVER MAKE NEGATIVE COMMENTS ON ANTIONIO'S PET PROJECT (the reason The Broadfather backed Antonio for Mayor -- TO GET GRAND AVE DONE)!

So if Rosendahl is saying that Grand Ave shouldn't be getting anymore subsidies, it is ZD's opinion that this is Antonio's way of breaking it to Bill Wittee of Related Cos. (Grand Ave Debacle Co-Developers; along with Arab Emirates of Dubai) that they ain't getting any more subsidies.

So looks like ZD was right when said this project would take off like a lead Zeppelin. That's because I saw the future -- and it said "No time for this luxury, five star bullcrap project that could never get done without all these subsidies. And now, due to ZD's economic predictions ALL COMING TRUE...it ain't getting done even with the subsidies. MAN DID JAN PERRY SCREW THE ENTIRE REGION OF SOUTHERN CALIFORNIA WITH HER RECKLESS PLANNING! That's because we all know, when it comes to developer money, Jan is like a very expensive whore who is for sale at any price. (And the community wreckage ensues.)

WAY TO GO AT GRAND AVENUE JAN PERRY! You really showed your leadership and vision for a historic Los Angeles. Historically tragic. You're going down in history alright, Ms. Perry...they'll be talking about how some developer whore fucked up the whole city over greed, power and vindictiveness. HOW CAN JAN PERRY WALK AROUND IN PUBLIC AND GO ON TV WITH ABSOLUTELY NO DIGNITY? (She must be very, very desperate to make back the money to pay back those college loans.)

Daily News article on Grand Ave "Dubai" Debacle

SO THESE ARE SOME OF THE ITEMS I WILL BE TYPING UP, PLUS EVERYTHING ELSE PILED UP IN MY INBOX.

Grand Avenue project changes ownership (EXCUSE ME...WHAT!?!?)

BILL WITTE OF RELATED SAID IT WAS AN INVESTMENT, SO DUBAI WOULDN'T BE INVOLVED IN DECISIONS!!! (HE USED THAT AS THE SELLING POINT!!!) NOW, IT IS A CHANGE OF OWNERSHIP. WHAT OWNER HAS NO SAY IN THE PROJECT? This is not a private project! It is a City, County and State project on public land, with CRA helping with the project and City Council and Board of Supervisors involved. So now the Royal Family of Dubai is having say in local land issues? Gotcha! ;) Spin away Citywatch!

From Daily News:

The Los Angeles County Board of Supervisors on Tuesday approved an ownership change for the $3 billion Grand Avenue project in downtown Los Angeles, transferring a 45 percent capital interest to a Dubai-owned company.

The developer, The Related Cos., will retain a 55 percent capital interest in the project.

Related's previous equity partner, California Urban Investment Partners - owned 97 percent by CalPERS and 3 percent by MacFarlane Urban Realty Co. - decided not to participate in the project.

"Unfortunately, CalPERS and MacFarlane were overinvested in downtown so Related has sought to find another equity partner," Supervisor Gloria Molina said. [Call it "overinvested", others say pulling out of a loser project. You never pull out of winners.]

"Related found Istithmar (Group), which was previously invested with them in the Time Warner Center Mandarin Oriental Hotel (in New York City) so they've dealt with them before. [But not in partnership with New York City, County and State government!] Under the ownership ... they will own the project and have key Related personnel remain as our contacts."

The supervisors voted 4-0 for the deal with the Istithmar Group - a subsidiary of Dubai World, a privately held holding company owned by the government of Dubai. [Eric Garcetti and Royal Prince of Dubai! Perfect match.]

Supervisor Michael D. Antonovich, who has long criticized the plan, abstained. [Good for you Mike. Why should you besmirch yourself over others delusions?] Afterward, Antonovich said he's been frustrated with construction delays and an estimated $176 million in taxpayer subsidies.

"It's a project I've been concerned about from the beginning," Antonovich said. "It's benefiting a handful of people and the cost overruns built into this project will be borne by the taxpayers who will be victimized once again from these types of developers."

full article

Zuma's previous Grand Ave Project coverage

Los Angeles To Subsidize Royal Family of Dubai with Grand Avenue Project

Grand Idea: Don't Make L.A. Taxpayers Subsidize Royal Families
By Walter Moore, Candidate for Mayor of Los Angeles, www.WalterMooreForMayor.com

You already know City Hall has agreed to give away hundreds of millions of dollars of your money and public land to downtown developers for the Grand Avenue project.

You also know that the housing market is down. Way down -- as in sales hit 20-year low in six Southern California counties.

Here's the new part: because the housing market is down so much, the original investors are bailing out of Grand Avenue. Specifically, the California Public Employees Retirement System (CALPERS) is no longer willing to gamble state employees' life savings on this project.

Guess who wants to step into their shoes? The Royal Family of Dubai. They're willing to put $75 million into the project. (Then again, the exchange rate being what it is, $75 million isn't what it used to be: a real dollar now sells for just one Canadian dollar.)

Now, I'm all for foreign investment in our country. As far as I'm concerned, people from the United Arab Emirates, the United Kingdom, the Klingon Federation or wherever are welcome to pour their euros, yen or pounds into our economy.

What does not work for me, however, is paying taxes to provide subsidies to the Royal Family of Dubai, the Queen of England, or other multi-millionaires, foreign or domestic, with or without sceptres.

According to the L.A. Times, joint city-county board overseeing the development must approve the substitution before construction can begin. The Los Angeles Downtown News says the approval process should take six weeks.

The City and County should take this opportunity to pull out of the deal -- just as CALPERS has done, on the advice of its San Francisco- based advisor, investment management McFarlane Partners.

You and I should not have to pay taxes to subsidize people who make more money than we do. If the Related Companies and the Royal Family of Dubai want us to invest in their project, they should offer to sell us stock in the project, not get our tax dollars for free. They should treat us like any other prospective investors, not like serfs.

At a time when the City wants to charge us extra to repair the sidewalk in front of our homes -- something our tax dollars should already cover -- we should not also have to shell out money for people whose family jewels are actually family jewels.

AWESOME TAKE WALTER...More on Grand Avenue Project including analysis of subsidies and the whole enchilada here.

LACityUpdate.com

Is The City of Los Angeles, L,A, County and CRA Now In A Joint Venture With Royal Family of Dubai at Grand Ave Project?

Since Grand Ave Project is a City, County & CRA (State) project on City, County and State public land, and the Royal Family of Dubai just invested in the project, does that mean the City and County of L.A. is doing business on public land with an overseas limited monarchy that is part of the United Arab Emirates? Maybe this is all hunky-dory, but I wonder what voters would have said about this business deal on public land and public trust? And keep in mind, the City, County and CRA bent over backwards to offer all kinds of corporate welfare tax breaks/subsidies, only to now benefit one of the richest oil producing families in the world!!! ONLY IN L.A.!!!

See new story about CalPERS pulling their investment out of Grand Ave Project, to be replaced with money from Royal Family of Dubai. Click here

"They're a huge fund that has invested in real estate all over the U.S.," said Witte. He added, "They're just investors. They don't have any control" over the direction of The Grand.

[EXCUSE ME!!! If they invest in private real estate all over the U.S., that's fine, I'm sure. However, remember, Grand Avenue Project is a joint effort with the City of Los Angeles (City Council is part of the deal) and State of California (CRA). So it sounds like the City of Los Angeles and State of California are in business with the Royal Family of Dubai. Is that a government agency, or what? Did voters of Los Angeles decide that the City should be in business with overseas oil sheiks? This is not like investing in your typical private piece of real estate in the U.S. It is on City, County and State owned property on a City, County and State project. Is this the first example of the U.S. doing a City project with an overseas government?

Related's previous partner, CalPERS, had invested entirely through MacFarlane Partners, which has had a hand in several Downtown projects including complexes Hikari and Block 8 in Little Tokyo (both from Related), and Forest City's Met Lofts in South Park. The firm made a splash last summer when it joined AEG in the $900 million Convention Center hotel.

[I HOPE THESE DOWNTOWN HOUSING PROJECTS TURN OUT TO BE A GOOD INVESTMENT IN THIS HOUSING MARKET. How's the investment going? I heard it tanked as vacant units plummet in property value, and it's only goin' down!]

"With the focus during the last quarter of 2007 on the L.A. Live investment, the firm determined for the moment another major investment in Downtown Los Angeles such as Grand Avenue would not be prudent," said company chairman and CEO Victor MacFarlane in an email last week, while traveling.

[What??? I thought you already committed to Grand Ave fully aware of LA Live??? Perhaps some of these reasons below are the real reasons, along with all the risk involved that I blog about in my article (see link below).]

Bob Safai, a lending expert and principal at real estate brokerage Madison Partners, agrees that securing equity is a challenge in the market reeling from the subprime mortgage crisis. Banks today often require loan seekers to put down about twice as much upfront as was required just a year ago, up to nearly half the total loan amount, he said.

"There's much more stringent requirements on getting a loan done," said Safai. "In this climate, when you're dealing with local banks, often times you have to give a recourse loan, which means you personally guarantee the loan; you're not just risking your equity."

Witte concedes that the climate is tough.

"We are of course in a credit crunch, but we have our equity partner committed so we're going forward," he said. "I'd be lying if I said this is an easy time."

[Oh good! Because the City and County is on the hook in this deal, too. If it tanks, so does the City's stake in this one of a kind in the U.S. business deal where you have the City and County in a speculative business deal with a private company.]

"These are very tough, very large projects in uncertain times, but the people who keep moving are the people like AEG and Related," he said. "We were here before Grand Avenue, and we'll be here after Grand Avenue."

[Great...battle of the luxury, five-star financial black hole CRA fundsucking projects. THIS AIN'T FUNNY FOLKS. READ THE ARTICLES I WROTE ON THIS. THE CITY AND CRA IS ROLLIN' THE DICE WITH A PRETTY BIG BET OF CITY LAND, MONEY, TIME AND TRUST. THESE PROJECTS COULD EASILY BANKRUPT THE CITY IN THESE ECONOMIC CONDITIONS. WHY DO YOU THINK CALPERS PULLED OUT?!?!?]

Now maybe this deal is the best thing since Cool Whip on pumpkin pie, but here are some things I found on a Google search for "Royal Family of Dubai". First of all, this was the first thing that popped up: "United Arab Emirates". Maybe that's good...not so sure about some of this, though?

Wikipedia Gems (I know, Wikipedia sucks! So feel free to dispute.)

* In May 2006, Dubai Investment Group through Dubai Islamic Investment bought 40% stake in Bank Islam, a subsidiary of Malaysia government-controlled BIMB Holdings Bhd.

* Dubai’s police may turn a blind eye to illicit diamond and gold imports, prostitution rings, and shady characters who buy 25 villas at a time in cash, but they are diligent in deporting Pakistani workers who complain about being cheated out of their wages by unscrupulous contractors, or jailing Filipina maids for ‘adultery’ when they report being raped by their employers.

* Dubai, like its neighbours, flouts ilo labour regulations and refuses to adopt the international Migrant Workers Convention. Human Rights Watch in 2003 accused the Emirates of building prosperity on ‘forced labour’. Indeed, as the Independent recently emphasized, ‘the labour market closely resembles the old indentured labour system brought to Dubai by its former colonial master, the British.’ ‘Like their impoverished forefathers’, the London paper continued, ‘today’s Asian workers are forced to sign themselves into virtual slavery for years when they arrive in the United Arab Emirates. Their rights disappear at the airport where recruitment agents confiscate their passports and visas to control them.

* Indeed, since 9/11 a huge investigative literature has explored Dubai’s role as ‘the financial hub for Islamic militant groups’: ‘all roads lead to Dubai when it comes to [terrorist] money’, claims a former high-ranking U.S. Treasury official. Bin Laden reportedly transferred large sums through the government-owned Dubai Islamic Bank, while the Taliban used the city’s unregulated gold markets to transform their opium taxes, paid in gold bullion, into laundered dollars.

* Many of Dubai's 250,000 foreign laborers live in conditions described by Human Rights Watch as being "less than human."

So I don't know if any of this is a factor, but I wonder what the people of Los Angeles would say about the City involved in this public deal with this limited monarchy, especially since the project is being handed tax breaks/subsidies and CRA is betting the farm on this project? I'm sure it must all be no problema, because the powers that be must be well aware of all of this, and know that the public will be raising these questions. So it must be one of those things that doesn't make some people too happy, but there's nothing actually wrong with it, it just might piss some people off.

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Grand Avenue Project Shocker: CalPERS, MacFarlane Partners Replaced in $3 Billion Project by Dubai Royal Family

Pictured: Grand Ave/Bunker Hill Vultures Broadaraigosa and Architect Frank Gehry

Many of you have followed my coverage of Grand Ave Project. Not a fan! Glad to see that CalPERS money (retirement fund) has been pulled out of this risky project. I've been warning about this, and who knows...maybe I scared 'em into pulling out for all the reasons I blogged about. Or maybe it was just so obvious, ZD looks good for predicting the obvious.

"Related will seek approvals from city, county and redevelopment officials over the next six weeks for the new investor in its proposed Bunker Hill mega-development. The company secured the new partnership with Istithmar, a sovereign fund controlled by the royal family of Dubai, after its key equity partner, California Public Employees' Retirement System, pulled out.

CalPERS had invested in the Grand Avenue plan through its San Francisco-based advisor, management investment firm MacFarlane Partners. Last June, MacFarlane joined the Convention Center hotel project being developed by Anschutz Entertainment Group as part of the L.A. Live project."
click here for full article

From ZD's Grand Ave article (June '07): ELI BROAD & CORPORATE WELFARE FUNDSUCKERS INC'S...GRAND AVENUE PROJECT!!!

THE SAVIOR OF THE CITY, REGION AND WORLD!!! We are just lucky to have it. (Or at least have the approval to start spending the money!)

I'm sure you will be reading much more about the overall details of the project (specifics of what it includes, business plan, comments from experts and community leaders, and the whole enchilada. Because how could you not? It's the biggest, most intertwined project in City, State or US History. Because you have the CRA, City Council, County -- AND, a private developer, Related Co. (working with CALPER, the pension money people who fund MacFarlane, who work with Related) ALL coming together for this one massive project, that has part of the details, sort of worked out...and they'll figure out the rest as they go along. (A $2 billion dollar starting point of a "wink and a handshake" to allow everyone to start spending and making the money!)


Previous ZD coverage of this loser project. (Including, "Problems already")

Zuma Dogg comedy analysis of LA Live: Click here