Kali Chaudhuri\u2019s KPC Development and Lendlease are asking Los Angeles for help finishing the 184-room hotel envisioned for the lower floors of downtown\u2019s most famous eyesore, Oceanwide Plaza.<\/p>\n
The city is now studying the joint venture\u2019s request for a hotel incentive agreement, according to a motion introduced Aug. 11 by Councilmember Ysabel Jurado and approved the following week, Urbanize LA first reported. Such agreements let developers retain a portion of the property\u2019s future occupancy tax to help finance construction.<\/p>\n
More hotel rooms will complement downtown\u2019s entertainment district, \u201cthereby improving the city\u2019s competitiveness in attracting conventions, trade shows, major sporting events, and tourism activity,\u201d according to the motion. <\/p>\n
Plus, the developers promise to remove a \u201clong-standing visual blight.\u201d<\/p>\n
But a long independent review process lies ahead, according to Jurado. \u201cNo incentive amount has been determined, and my motion does not approve one,\u201d she said in a statement to the Business Journal. <\/p>\n
A 2018 audit of past incentives the city has dished out to developers scrutinized their efficacy. Then-City Controller Ron Galperin reviewed five hotel incentive agreements worth a total of $654 million and found the city had been evaluating them \u201cwithout a comprehensive citywide economic development strategy,\u201d according to the audit. <\/p>\n
Jurado added that she read the 2018 audit and plans to heed its advice. <\/p>\n
\u201cThe Controller\u2019s 2018 report called for stronger scrutiny of claimed financing gaps and promised public benefits,\u201d Jurado said. \u201cThis motion begins that review. Any agreement I could support would need enforceable protections for public dollars and meaningful benefits for workers and surrounding communities, including prevailing wage, local hiring, job training, and strong labor standards.\u201d<\/p>\n
\u2018Feasibility gap\u2019 <\/p>\n
Galperin specifically criticized reliance on developers\u2019 claims of a \u201cfeasibility gap\u201d \u2013 the argument that a project can\u2019t be built without public assistance. <\/p>\n
\u201cThere has not in all cases been adequate evidence to necessarily support these arguments,\u201d the audit concluded. It recommended more rigorous evaluation of feasibility-gap claims and called on the city to review actual project outcomes and add \u201cclawback\u201d provisions to recoup public funds if promised benefits don\u2019t materialize.<\/p>\n
The debate resurfaced in recent years when Hillcrest Real Estate requested incentives for its 395-room expansion of the Hilton Universal City Hotel, though that project was shelved last year after Los Angeles raised hotel workers\u2019 minimum wage ahead of the 2028 Olympics, the L.A. Times reported. The council later voted to push back the wage increase to 2030, as the Business Journal reported in May.\u00a0<\/p>\n
Watchdog groups also criticized proposed incentives for a 300-room hotel at South Park Towers, a residential project underway at 1600 S. Flower St. KPC and Lendlease\u2019s request comes amid a ticking clock to secure financing for the long-stalled residential towers at 1101 S. Flower St.<\/p>\n","protected":false},"excerpt":{"rendered":"Kali Chaudhuri\u2019s KPC Development and Lendlease are asking Los Angeles for help finishing the 184-room hotel envisioned for…\n","protected":false},"author":2,"featured_media":456892,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[165560,48,52,51,47,50,49],"class_list":["post-456891","post","type-post","status-publish","format-standard","has-post-thumbnail","category-los-angeles","tag-kpc-development-co","tag-la","tag-la-headlines","tag-la-news","tag-los-angeles","tag-los-angeles-headlines","tag-los-angeles-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/456891","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=456891"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/456891\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/456892"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=456891"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=456891"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=456891"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}