Plan for Taller Hotel at Colorado Place Stuns Santa Monica Council

The owners of Colorado Place, facing an environmental review of their plan to complete the $225-million project with three office buildings and a 13-story hotel, are proposing another plan with a 16-story hotel that they claim Santa Monica must approve under a 1981 development contract.

Members of the City Council said they are stunned by Southmark Pacific Corp.’s assertion that the latest plan would have to be approved by the city under terms of the development agreement.

“I have very strong doubts about their ability to proceed within the development agreement as they suggest,” said Councilman Dennis Zane, who helped negotiate the contract.

“If they seek to proceed with this contorted interpretation (of the agreement), I will do all I can to assert our rights to have the language interpreted in the straightforward manner that was intended,” he said. “I am unequivocally opposed to increasing the hotel height and I will seek any remedy I can to prevent it.”

‘Great Shock to Citizens’

Mayor Christine E. Reed said she, too, was appalled at Southmark’s contention that a 16-story hotel would be allowed under the 1981 agreement between the city and the original developer, Becket Investment Corp. Southmark acquired the project in January and is bound by Becket’s agreement.

“Obviously a 16-story building in the middle of this site is going to be a great shock to citizens in the area, and it would be terribly regrettable if we had approved language (in the development contract) that would allow this to happen,” Reed said.

She said that when the council approved the development agreement, plans called for a nine-story hotel. “No mention was ever made of any height different from nine stories,” she said.

Robbie Monsma, an attorney for Southmark, said the complex development agreement uses an averaging formula to determine allowable heights. She said either a 13- or a 16-story hotel would be permissible with sufficient low-rise development to offset it and result in an average height that does not exceed 56 feet (about five stories).

Legal Ruling Sought

In response to the new Southmark proposal, Zane last week requested a ruling from City Atty. Robert M. Myers on the question of what height is permissible under the development contract.

Myers, in an interview Thursday, said he cannot make a definitive ruling without seeing a specific plan from Southmark.

But he said a 16-story hotel would be a “material change in the development concept approved by the City Council in the development agreement.” This substantial change could not be made without council approval, he said.

Myers said that in an environmental review and discussions conducted during the 1981 contract negotiations, talks centered on a low-rise hotel, not a high-rise structure.

Myers served with Zane on the team that hammered out the controversial contract, which required Becket to provide 100 units of low-cost housing and a child care center.

Story on ’60 Minutes’

In an interview on CBS television’s “60 Minutes,” the contract was described as “legal extortion” by N. David O’Malley, then president of Becket.

The plan developed by Becket called for two phases of construction on the 15-acre site bounded by Colorado Avenue, Cloverfield Boulevard, Broadway and 26th Street.

The first phase, completed at the end of 1983, includes three office buildings and a plaza with restaurants on the south half of the project facing Colorado.

The second phase, facing Broadway, calls for two office buildings, two nine-story hotel towers and a 3.5-acre park.

Southmark studied the Becket plan and found that the 400-room hotel was too large to be economically feasible and that financing could not be obtained, according to Monsma.

New Plan Submitted

In October, Southmark submitted to the city a revised plan with a single, 13-story hotel tower, three office buildings and 1.5 acres of park. An additional 3.3 acres of park was proposed at a site a few blocks away, on Colorado between Cloverfield and 20th Street.

The October plan received mixed reactions from residents, some of whom liked the idea of a 3.3-acre park with playing fields. Others said it would be too far from residential neighborhoods.

Opponents include Mid-City Neighbors, a residents group that helped negotiate the Becket plan and favors keeping a 3.5-acre park at Colorado Place.

The city Planning Department ordered an environmental impact report on the October proposal, with the 3.5-acre park, three office buildings and a 13-story hotel.

Southmark President Paul J. Giuntini responded with a letter to City Manager John Jalili stating that the company still hopes to gain approval for the 13-story hotel plan on which the environmental report is being made. But he said the company will proceed with the 16-story hotel plan, which will be submitted to the city Architectural Review Board.

No ‘Threat’ Intended

If further mitigation measures are required as a result of the environmental study of the 13-story plan submitted in October, Giuntini said, Southmark “may be forced to develop (the 16-story hotel plan) under the existing development agreement.”

“We do not mean this as a threat, because we still hope to obtain approval of the amendment (the 13-story hotel plan), and we do think that proposal is best for all parties,” he continued. “But we cannot lose the ability to go forward as soon as possible in a way that makes economic sense.”

Councilman James P. Conn said Thursday that he is outraged at Southmark’s latest proposal after hearing the above portion of Giuntini’s letter. “To my mind, it’s a threat,” he said.

“This is one of the most outrageous things that anybody has proposed in this city in a long time. If they want to spend 10 years in court, that’s OK with me. They’re not going to build 16 stories here.”