LA WATCHDOG - Angels Landing is a proposed $1.6 billion development located at 4th and Hill Streets in DTLA, next to Angels Flight, the shortest railway in the country.
Its two towers of 64 and 42 stories will house 180 condominiums with “aspirational” prices, 252 luxury apartments, two hotels containing 515 rooms, 72,000 square feet of retail and restaurant space, and 750 parking places.
The project expects to be completed in time for the 2028 Olympics.
This first-class development will house two hotels, one in each tower. According to the Los Angeles Times, there will be a four-star inn with 255 rooms while the second will be a five-star luxury hotel with 260 rooms.
This private sector developer will be seeking numerous tax breaks, including, but not limited to a tax abatement agreement where the City will kick back a portion of the 14% hotel tax to the developer. Typically, this results in the developer pocketing 100% of hotel tax for the first ten years of operation.
The amount of the tax abatement is determined through a study by a consultant retained by the City but paid for by the developer. Predictably, the made-as-indicated report will justify the giveaway by determining that the value of this badly needed hotel is less than its cost. Of course, this is utter nonsense.
While it is not possible to determine the precise amount of the giveaway at this time, previous tax abatements would suggest a subsidy of $150,000 a room, or in this case, $75 million, payable over the following ten years.
But this giveaway of taxpayer money is not in the best interests of the City or Angelenos. Rather, it could be used for other matters, including balancing the budget, repairing our streets, cleaning up our parks and their restrooms, or providing shelter to the homeless.
Overall, the nine projects listed in the City’s Comprehensive Annual Finance Report will benefit developers by over $1 billion in giveaways, a complete rip-off of Angelenos.
This $75 million giveaway can be stopped by Councilmember Kevin de León because Angels Landing is in his council district. And even if this candidate for mayor approves this giveaway of our money, he can demand that the City be repaid the foregone revenue (with interest and a piece of the profits) when the hotels reach full profitability in the next five to ten years.
(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and is the Budget and DWP representative for the Greater Wilshire Neighborhood Council. He is a Neighborhood Council Budget Advocate. He can be reached at: [email protected].)