L.A.'s Big Money Talks Downtown's Future
The "Downtown 2020" summit this week presented a vision of an L.A. downtown denser with people and culture and entertainment options. But who would pay, and who would profit, from this vision?
The L.A. Times summed up the power broker's visions:
Billionaire philanthropist Eli Broad and developers Jim Thomas, Tim Leiweke, Nelson Rising and Tom Gilmore...admitted that the recession -- which has already stalled some planned projects and left a lot of loft and office space empty -- might slow things down a bit. But they vowed to persevere.Broad said he would open his new $300-million downtown art museum by December 2012 . Thomas, of Thomas Properties Group, promised to build a 60-story office building by 2015. And Leiweke, president of AEG, shared the details of his company's proposal to redevelop one of the halls of the Los Angeles Convention Center into an exhibition space that could double as an NFL stadium..... Leiweke, who helped bring Staples Center and L.A. Live to the Figueroa Street corridor, said other events such as the World Cup and NCAA Final Four games could take place in the downtown stadium. He said it would help the entire downtown economy.....
Here is some counter-evidence to the proposition that investing public money to help private sports stadium owners operate is good for local economies as a whole, an article called "The Stadium Gambit and Local Economic Development," from a pair of economists from the University of Maryland.
Meanwhile, Eli Broad, who helps fund and build cultural institutions, unsurprisingly thinks that "increasing the number of cultural institutions also will be important. To that end, he said, next month will mark the groundbreaking of the first phase of the contemporary art museum that will house his personal collection...."
Here is some background, from my Reason magazine colleague Tim Cavanaugh, on the cheap sweetheart rental deal the very rich Broad got from the city.
L.A. Downtown News also reported on the conclave of moneybags:
That vision is part of a larger sentiment shared by Leiweke's panel cohorts that if Downtown is to continue to grow over the next decade, the local economy and infrastructure need to facilitate tourism. That means more conventions, which in turn means more hotels, more retail and more residential growth, panelists said....The three panel conversations shared one predominating, unplanned theme: The area is desperate for better transportation systems, from more efficient freeway and street design to some kind of urban circulator project that moves people around Downtown. Carol Schatz, president and CEO of the [Central City Association], said the event was conceived as a way to generate a new wave of momentum toward sustained growth and economic development Downtown.
Ron Kaye says nuts to them all:
Leiweke shares his vision to tear down the old wing of the Convention Center to build a monument to football, a massive new wing to the convention center and yet another luxury hotel.What could be more thrilling for LA, with its closed parks and libraries and open slather policies for developers than to have taxpayers match AEG dollar for dollar to have a stadium downtown instead of out in the City of Industry where Leiweke's former partner, Ed Roski, has a shovel-ready stadium that won't cost the public a dime.... Leiweke who was the star as he talked about he and Jan Perry want to transform downtown by "expanding the city-owned Convention Center's footprint and adding an NFL stadium that could also host NCAA basketball tournaments and soccer events.... "If things come together with football and if we put up $1 billion and agree to backstop construction of a new West Hall then we'll probably have to make sure the taxpayers are not at risk," Leiweke was quoted as saying in the Downtown..... This is a town with a rotting infrastructure of roads, sidewalks, pipes and power lines, a town that can't pay its bills and guts basic services, a town whose leadership has lost all credibility and now want us to believe $1 billion of our money would have the greatest impact if we spent it for a football stadium.
Kaye took a good look at the City of Industry option for football in the L.A. area:
A few weeks ago, I went out to Industry, which is more of a business than a city with a population of only 913, and got a tour from John Semcken of the NFL stadium that Roski's Majestic Realty is ready to build.They own the land. They have all the entitlements. The roads and freeways already are being fixed to handle crowds of 75,000 people on football Sundays. They have the architectural drawings. They even have the money and it's all their money. What they don't have yet is a team and that will come in the spring when the NFL and its players cut a deal for a new contract -- unless, of course, Leiweke outbids them and City Hall rolls over gives away the public's money to him. Leiweke and Roski teamed up to build Staples Center and the original deal required them to.tear down the old hall of the Convention Center and to build a new and larger one that would have given LA a first-class million-square-foot facility. But in their infinite foolishness, the City Council stepped in and rewrote the terms of the deal to let them off the hook. Now Leiweke has the brass to demand $1 billion in taxpayer money to enrich himself and AEG's owner, Phil Anschutz, even more. Let's put it to a vote of the people and see if they want to spend their money that way or travel a few miles east to pay exorbitant prices to watch an NFL game live and in person.
And while thinking big thoughts about downtown's future, best to remember that if people aren't willing to freely put money into things, they might not really be economically viable, or a good idea for anyone but the special interests getting subsidized: The Times' story ends noting that "The Grand Avenue Project's plans for a $3-billion, Frank Gehry-designed hotel, condo and shopping complex have been delayed indefinitely because developers have been unable to secure financing."
Image taken by Flickr user Zerega. Used under user Creative Commons license.