Disputes, Sale Have Left Prime Boulangerie Site a Dump
By DANNY KING
Once frequented by diners looking for an outdoor patio to enjoy lunch and Pacific breezes, the former Pioneer Boulangerie property in Santa Monica is a dumping ground with an ocean view.
Though arguably one of the Santa Monica’s more desirable locales, it has languished over the last four years as its owner and the city have been at loggerheads over its redevelopment.
Since Pioneer French Baking Co. closed the restaurant and consolidated operations at its Venice plant in 1994, the 68,000-square-foot site on Main Street has been used as a parking and storage shed lot, in addition to a site for unloading 15-foot-high piles of gravel and dirt from nearby street excavations.
“The property has been rented on and off for the past three years to contractors working for the city,” said Howard Jacobs, a consultant for the owner, 2000 Main Street LLC. “It’s a way of generating a very modest income for the property.”
To Richard Hirsch, a partner at Nasatir Hirsch Podberesky & Genego whose offices have been across the street from the site for 20 years, “it’s been a tremendous eyesore. We’d be happy to see it torn down and rebuilt to revitalize ize that part of Main Street.”
Last fall, the property was listed for $27 million and at the time Jacobs said all options would be considered, including developing the property and selling it.
Today, the price is $24 million.
“We’ve received many offers on the property,” Jacobs said last week, noting that none of them have passed muster. He said 2000 Main Street would still consider developing the property itself.
Delays and disputes
Redevelopment has been a long-running point of contention between property owner and city.
In April 1999, nearly two years before completing its purchase of the property from Pioneer, the developer submitted a plan to redevelop the entire site into a mixed-use project that would include 133 apartments and more than 18,000 square feet of ground floor retail.
The city’s planning commission denied the project in December 2001, citing scale issues in an area where most of the storefronts were constructed more than half a century ago.
The City Council overruled the planning commission and approved the project in February 2002. The planning commission in September approved its design components.
“Part of the issue that vexed this process is defining what is compatible, and that itself is somewhat subjective,” said former mayor Michael Feinstein, who has been on the council since 1996. “Normally, an entire block doesn’t get developed at once.”
As a result, 2000 Main Street sued the city, seeking about $2 million in damages caused by the delays. Earlier this month, Superior Court Judge Patricia Collins threw out the developer’s claims, noting that “delays in the permit process itself are not actionable.”
“It was a complicated EIR,” said Cara Silver, deputy city attorney. “The city’s not responsible for normal permit delays.”
The developer will appeal the decision.
“(Collins) made a mistake,” said Jacobs. “We believe that will be overturned on appeal.”
The ongoing battle and deteriorating condition of the site reinforces the city’s reputation among developers as a difficult place to get projects approved.
Dale Goldsmith, partner at Greenberg Glusker Fields Claman Machtinger & Kinsella LLP, said an environmental impact report for a 210,000-square-foot addition to Lantana Media Campus near the city’s eastern border was completed in November, more than two years after owner Hines submitted its application to the city.
“The time curves in Santa Monica are probably longer than in other jurisdictions I’ve practiced in,” said Goldsmith, who represents Hines. “Whether the city is more thorough or less motivated is up for debate.”
That could explain why the property has sat on the market for six months despite the $3 million price reduction.
Joseph Gabbaian, senior vice president at Grubb & Ellis Co., said recent sales and build-out costs for comparable mixed-use properties would value the site at about $22 million. “It’s priced so that there’s not enough room for a developer to build and sell for a profit,” said Gabbaian. “He has to find somebody willing to build and hold.”
Still, with the average Santa Monica apartment renting for nearly $2,000 a month last year, according to Hendricks & Partners, and Main Street retail space fetching between $2.50 and $3.50 a foot, demand will be high, according to Rafael Padilla, principal at Santa Monica-based PAR Commercial Brokerage.
“It will do great,” said Padilla, chuckling. “If it actually ever gets built.”