Weekly Report – August 24, 2015
The L.A. Coalition’s and Mayor’s Operations Innovation Team continues to play a significant role in analyzing ways in which the city of Los Angeles could establish a management plan for the City’s $3 billion real estate portfolio. More specifically, this plan will include recommendations to maximize the value of the City’s most underutilized property.
In 2014 a study commissioned by the City Administrative Officer (Summary document: http://goo.gl/U6q0X0) explored how the City optimizes its use of space. The study noted that the City has made considerable progress on space optimization since their 2009 Strategic Plan was adopted. This included reduction of lease expenditures, consolidation of staff at Figueroa Plaza, completing Public Works Building consolidation, constructing “greener” buildings and disposing surplus properties.
The study also noted that there is insufficient space in the Civic Center in downtown Los Angeles to bring all City operations that could be centralized into City-owned space. The consultancy team made a number of recommendations that the City should consider in order to address this issue and also discussed a number of improvements that the City could take in terms of processes that the City could undertake in the areas of deployment management, technology management, data management and asset portfolio management.
Background
The city of Los Angeles maintains a broad and diverse portfolio of real estate and the City functions as a property owner and occupier, developer, landlord and tenant. Currently, the City has about 1.6 million square feet of “non-optimal” office space that it either leases or is otherwise remote and inefficient for workers. Many city employees remain scattered throughout Downtown. Some work in the Garland Center at 1200 W. Seventh St. in City West while others are east of Little Tokyo at 700 E. Temple St. or at Figueroa Plaza next to the 110 Freeway. Additionally, a recent environmental impact report for the Parker Center redevelopment highlighted that the City needs about an additional 1.1 million square feet of office space to satisfy current demand.
One of the driving questions is cost. The City is spending $30 million or $40 million on leases each year and no one has run the numbers on the break-even points if and when the City moves forward with plans to build new structures.
The Civic Center
The Civic Center in downtown Los Angeles has the potential to meet the long-term needs of the city, yet the last comprehensive discussion about a Civic Center Master Plan was in 1995 and its concluding assessment in 1997 was that there was a need for a Civic Center to create a common space in the symbolic and operational heart of government.
The plan, often referred to as the “10-Minute Diamond,” suggested consolidating city, county, state and federal government workers so that they were within a 10-minute walk of City Hall, with the idea that this would streamline communication and create a critical mass of pedestrians to activate the area. A decade later, many new downtown buildings have opened, while the Civic Center still has a collection of underutilized structures, awkward thoroughfares and empty lots.
Assessment
The City owns enough property to explore building a series of office structures in the Civic Center. In addition to the aging City Hall South building at the northeast corner of First and Main streets, there is the Parker Center block and the parcel on the northeast corner of First and Alameda streets dubbed “the Mangrove Estate.” Different plans have been floated for all of the sites in the past.
Figuring out Parker Center is the key to planning the rest of the Civic Center, experts say. While the size and look of a project there remains to be seen, any structure would need to incorporate not just government needs, but also those of the rapidly expanding residential base. There aren’t many locations left to do a government-only building and there’s got to be an effort to maximize office space for the city and include mixed uses for the public.
Key Assets
Parker Center. The Center has been empty since the Los Angeles Police Department moved its headquarters to the new Police Administration Building in 2009. The future of the empty Parker Center hang on the historic merits of architect Welton Becket’s 1955 building. In April, the City Council’s Planning and Land Use Management Committee was supposed to review the city Cultural Heritage Commission’s nomination of the 1954 Parker Center as a Historic-Cultural Monument. The deadline came and went because of a technical mistake, but the hiccup has opened a window to consider exactly what to do with Parker Center and what the Civic Center needs. The city Bureau of Engineering had previously recommended razing Parker Center and replacing it with a $475 million, 27-story office tower that would hold employees from multiple city departments. Preservation groups, including the Los Angeles Conservancy, are pushing the city to renovate and reuse the structure at 150 N. Los Angeles St. rather than demolish it, and in May, 14th District City Councilman José Huizar authored a motion asking city staff to look not just at creating office space on the Parker Center site, but also to explore the reuse of nearby city-owned properties such as the underutilized Los Angeles Mall. What happens on this site will determine what occurs on other plots in the district.
Los Angeles City Mall. One of the most puzzling pieces is the L.A. Mall. The complex at 201 N. Los Angeles St. has about 100,000 square feet of underground retail space that is only about one-third occupied and it would be a perfect site for a city office building. The commercial space isn’t the most viable and it’s not very viable for anything else. Some argue that no one else is going to build a residential structure or office building there and there are no easy solutions because the mall is on top of a 2,000-space parking garage, which poses logistical and engineering questions.
The 1940 Federal Courthouse at 312 N. Spring St. This site across from the L.A. Mall will be mostly empty after the new federal courthouse is complete, but its configuration (the courtrooms lack windows) and designation as a historic structure complicates any demolition or major transformation. No reuse plans have been revealed.
The County Hall of Administration and the Stanley Mosk Courthouse. Some have called for the redevelopment or razing of these building because the later has a imposing, unfriendly presence on First Street. But as with Parker Center, Conservancy activists cautions people from jumping to demolish a structure because it seems “ugly.” The odds are very high nothing will change here.
Positive momentum.
Federal Courthouse. The steel frame for the $323 million Federal Courthouse was finished in March, and construction workers are now putting in concrete shear walls. Located at the southwest corner of Broadway and First Street, the Federal Courthouse is slated for completion in fall 2016, according to Traci Madison, a representative of the U.S. General Services Administration. The 600,000-square-foot building will have 24 district courtrooms and 32 judges’ chambers, as well as offices for the U.S. Marshals Service. The courthouse is designed as a large cube with windows set at angles to create a serrated outer skin. The design from Skidmore, Owings & Merill aims to bring in natural light while also cutting solar heat gain. The Civic Center building is being engineered to achieve LEED Platinum status, according to the GSA.
Regional Connector. The Metropolitan Transportation Authority is wrapping up final designs on the $1.42 billion Regional Connector, in conjunction with the build team of Skanska USA and Traylor Bros. Major utility work is also starting in Little Tokyo, where the main underground tunneling will begin later this year. Plans call for the sites of three new rail stations — at Second and Hope streets, Second Street and Broadway, and First Street and Central Avenue — to be excavated in the third quarter of the year. The 1.9-mile Regional Connector will join area light rail lines to streamline cross-county travel and reduce the need for transfers. It is expected to open in 2020. At metro.net/projects/connector. a park is being planned at the northeast corner of Broadway and First Street. A station for the Regional Connector at Second Street and Broadway could spur development on surrounding blocks.
Related Cos.’ $850 million Grand Avenue plan. Planners believe this development will usher in a new era for Bunker Hill as a cultural and residential hub, and in turn help pump life into the Civic Center. Benefits include “socially equitable housing” in the project. The premise is smaller units encourage people to get out into the community. Ideas are abound, such as, using city and county buildings to host community activities and even movie screenings and how to reconnect the Civic Center with El Pueblo and Union Station (tens of millions of people will be moving through the station as rail projects and the high speed rail continue to increase rail access) on the horizon. Experts thinks a Civic Center joint powers authority with city and county leaders could lead to a new master plan.
The Union Station Master Plan. This plan earned the blessing of the Metropolitan Transportation Authority’s Board of Directors in October, and is now in the implementation stage. The primary task at hand is the project’s full environmental impact report, and Metro aims to begin the review process this month. The EIR would take about a year to complete, according to Metro Deputy Executive Officer Jenna Hornstock. Metro is also applying for state grants this summer to fund initial improvements along Alameda Street, she said. The Master Plan comprises two main elements: It would build a larger indoor-outdoor passenger concourse to connect travelers to an updated rail yard; and it would demolish the existing Patsaouras Bus Facility near the eastern entrance to Union Station and replace it with an elevated bus terminal between the historic station building (the west entrance) and the new concourse. Other proposed improvements include the conversion of the west parking lot into a public plaza and the creation of a walkway over the rail lines. At metro.net/projects/la-union-station.
Other related news.
California Environmental Quality Act (CEQA)
A recent study of more than 600 lawsuits filed under the California Environmental Quality Act (CEQA) reaffirms that the law is frequently abused to stop projects crucial to meeting California’s environmental, social equity, and economic policies. The study conducted by the law firm Holland & Knight is a first-of-its-kind comprehensive review of cases at the local, regional or state agency level during a three year study period (2010-2012). While CEQA was intended to benefit the environment, the study entitled “In the Name of the Environment: How Litigation Abuse Under the California Environmental Quality Act Undermines Environment from CEQA Litigation Abuse,” reveals that it is often used contrary to the state’s environmental protection goals.
It reveals that 49 percent of CEQA lawsuits were filed against taxpayer-funded public works projects; 80 percent targeted infill or greenfield development projects in urban areas; 21 percent of private sector projects challenged were housing related, with nearly half of these CEQA housing lawsuits challenging types of affordable and other multi-family projects that are critical to addressing the statewide housing crisis; the top target of CEQA lawsuits challenged projects designed to achieve critical environmental objectives, such as new and retrofitted clean energy projects, and in the case of infrastructure, transit projects; and CEQA was used against projects that had already undergone an earlier environmental review process. The findings of this exhaustive analysis run counter to the common perception that CEQA litigation is primarily used to benefit the environment.
In fact, the numbers show that CEQA lawsuits most frequently target infill housing projects, public works projects such as transit, renewable energy projects and other critical projects. The Study also confirms that CEQA litigation is only rarely used by well-known national and statewide environmental advocacy groups like the Sierra Club, Natural Resources Defense Council and Audubon Society. In fact, only 13% of CEQA lawsuits are filed by these environmental groups – with the plurality (45%) filed by an assortment of “associations” which do not need to disclose either the existence or interests of “members” and individuals. Follow-up investigations into these anonymous “associations” revealed widespread abuse of CEQA for non-environmental purposes by business competitors, labor unions, “greenmail” lawyers seeking financial settlements, and Not-In-My-Backyard (NIMBY) groups on the losing end of votes by elected officials or residents. For more information go to: www.CEQAWorkingGroup.com.