Fact Checking ‘News’ Articles that Shill for Real Estate Speculation in LA

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PLATKIN ON PLANNING--By now we have all encountered news services, like Politico, that fact check politicians during the election campaign. Well, this week I am offering a similar service to CityWatch readers. I have fact checked three recent “news” articles that sing the praises of extravagant real estate speculation in Los Angeles.

Hopefully, my fact checking will help you critically assess the constant stream of quasi-journalistic falsehoods that spin the virtues of illegal real state projects that rely on special, parcel level City Council ordinances to become legal. 

More specifically on my blog I have posted my extended corrections to these three articles: 

• “In Cranes’ Shadows, Los Angeles Strains to See a Future with Less Sprawl,” New York Times, September 21, 2016. 

• “Tall v. Sprawl – Build Better LA Proposition Will Determine Our City’s Future,” LA Weekly, September 27, 2016. 

• “LA Community Developer Caruso Struggle with Caruso’s ‘Dream Project’,” City Watch LA, September 26, 2016.                                                                                                                          

While I certainly invite you to go to the link for my blog, Plan-It Los Angeles, here is the abbreviated version of what you will find there.  

In their efforts to celebrate real estate speculation, all three articles rely on a journalistic form to candy-coat private commercial interests trying to game the land use system. This is why I call these articles info-journalism. They are the print version of an infomercial, those mock late night TV ads that mimic news stories, but are really nothing more than an extended commercial touting a specific product, such as a Veg-O-Matic kitchen utensil. 

In addition to their faux journalistic form, all three articles fail to mention the following: 

1. The mega-projects in the sights of the Neighborhood Integrity Initiative are all illegal. The adopted laws of the City of Los Angeles bar their construction because they conflict with the City’s adopted General Plan and the zoning code that implements the General Plan. 

2. In order for these otherwise illegal projects to be constructed, the City Council must adopt a special law for their underlying parcel that, essentially, exempts the project from the City’s General Plan and from the zoning laws that implement the General Plan. If this looks like “Pay to Play” to you, I suggest you trust your intuition. 

3. All of these large mega-projects require a full Environmental Impact Report (EIR), and all of these EIRs identify an environmentally superior alternative, such as a modification of the existing structure or a replacement structure that could be built by-right because it already conforms to General Plan and the Zoning Code. 

At the request of the investor, however, the City Planning Commission and the City Council never opt for the environmentally superior alternative. Instead, they support the most environmentally damaging alternative. In doing so, they always adopt a Statement of Overriding Considerations, and these Statements always rely on the developers’ claims that that his or her project will generate jobs and/or transit ridership. None of these claims are ever subsequently monitored and verified, and there are no consequences, such as the revocation of a building permit, if the purported benefits fail to appear. 

4. Even though all of these “illustrious” projects are substantially higher and larger than nearby legal buildings, the City Planning Commission and the City Council gloss over the General Plan’s clear principle that new development must be consistent with the character and scale of existing development.   Despite obvious design clashes, the City Planning Commission and the City Council never reject a project on design criteria, even though the General Plan Framework Element has an entire chapter and three appendices solely focused on neighborhood and building design. 

5. The General Plan is also clear that new development must have sufficient supportive public infrastructure and public services for deviations to proceed. Yet, none of these articles mention that LA’s infrastructure is strapped and often failing, that the city is headed for natural disasters that will compound underinvested infrastructure and services, and that the City has not properly monitored its own infrastructure and public services in nearly two decades. 

6. The General Plan Amendments, Zone Changes, and Height District Changes that the City Council dishes out to its cronies dramatically increase the value of the underlying land. Yet, none of this added value comes back to the City as additional property taxes because of Proposition 13’s giant loopholes. This is because the title does not change, and the only benefit to the city and state is from sales taxes generated by on-site businesses. 

Now, some special fact checking for each of these articles. 

The New York Times article presents current land use disputes in Los Angeles as a disagreement in esthetics and values between those who want a slowly growing, dispersed city versus those who want a concentrated city with rapid growth that also addresses its housing crisis. This is an entirely false distinction. The opponents of the mega-projects are not fans of suburbanization or slow growth. They simply want a city that prepares, adopts, implements, and then monitors an up-to-date General Plan. These plans designate many areas where density and height are allowed, and they ensure through careful planning and monitoring that the city’s infrastructure and services are up to the task. This position is not pro-sprawl, pro-suburbanization, pro-slow growth, and pro-a housing affordability crisis. These ridiculous claims are nothing more than the unquoted repetition of the desperate arguments of anxious business interests whose latest business ventures are real estate projects, not to Kruggerands, cotton futures, and high tech start-ups. 

The LA Weekly article is even worse than the New York Times article when it comes to false distinctions in order to convince its readers that speculation in otherwise illegal real estate projects is just what the doctor ordered for an ailing Los Angeles. On one side the Weekly presents a modern urbanist faction that yearns for an LA that should be tall, dense, served by mass transit, bike lanes, and pedestrian-friendly streets. Their preservationist opponents are those who want a Los Angeles that is supposedly wide, sprawling, car-oriented, and dominated by single-family homes. This imaginary distinction, too, is utter nonsense. 

The real dichotomy is between those who advocate for a city that is properly planned and monitored, versus those who implicitly call for a city that grows willy-nilly, based on short-term profit maximization, oblivious to existing zones, plans, public services, public infrastructure, neighborhood scale, and neighborhood character. But, support of good planning is independent from the pace of growth, single-family homes, mass transit, bicycle lanes, and creating a pedestrian environment. In fact, as anyone who has reads my weekly CityWatch columns knows, these features are all part of a properly planned city, and this is the best way to ensure that these vital infrastructure components appear. 

The CityWatch article was largely a sympathetic interview with the head of a company, Caruso Affiliated, that wants to build a 240-foot high luxury high rise project at the site of the recently closed, three-story Loehman’s store near the Beverly Center. Because the developer made a last minute change to his list of required discretionary actions by adding an SB 1818 Density Bonus option, the article presents the developer as a billionaire populist who is trying to create a model of egalitarian life style in Los Angeles. 

While few hired publicists would go overboard like this, the article unsurprisingly fails to mention that the only objective change in the project is converting 8 of its 145 luxury ($10,000 to 20,000 monthly rents) to affordable units whose actual rents are not yet known. The article also fails to mention that many other developers of market housing, including high-end housing like this project, have taken similar advantage of SB 1818. They, just like Caruso Affiliated, have been able to bust through zoning laws, by converting 5 percent of their units to affordable apartments (that are never subsequently field inspected by the City of Los Angeles). 

Furthermore, the developer’s boast that the 8 tenants of the affordable units will have access to the same amenities of the 137 global one-percenters paying full fair is not even optional. It is a legal requirement to treat al tenants the same. 

Finally, by opting for the 5 percent SB 1818 option now, the developer may be able to shield himself from the 15 percent requirement of the Build Better LA Initiative on the November 2016 ballot. He may also insulate himself from the City’s pending 20 percent affordable inclusionary housing requirement contained in the Value Capture Ordinance now worming its way through the City’s lumbering preparation and adopting processes. 

Readers, hopefully my fact checking has come in handy, and if you encounter any more info-journalism promoting mega-projects that you want debunked, my email is below.

 

(Dick Platkin is a former Los Angeles City Planner who reports on local planning issues for CityWatch. Please submit any comments or corrections to [email protected].)

-cw