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New Pact Tentatively Approved for Carson’s Long-Awaited Hilton

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Times Staff Writer

City officials have tentatively approved a $1.5-million loan and what could amount to more than $1 million in tax rebates for the developer of Carson’s long-sought Civic Center hotel.

Insisting that the developer of a proposed Hilton hotel break ground within 90 days, the City Council, acting as the Carson Redevelopment Agency, set new terms for construction of the 11-story, 248-room facility. The project has been considered by the city for more than two years, but has suffered a series of delays and financial uncertainty.

Officials approved the seven-year loan, a five-year rebate on bed taxes not to exceed $250,000 a year, repayment of city expenses incurred during hotel negotiations, interest-rate terms and several other conditions. The interest rate is to be three points above the monthly average established by the Federal Home Loan Bank, which is currently 10.16%.

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The tentative agreement--to made final by May 20--is the first firm commitment that Carson has made to the developer, the Feinberg Group, since it failed to close on a similar deal last November for lack of financing. When that deal collapsed, the developer maintained that the city had not allowed enough time to assemble the $22 million in loans it needed.

Time Still a Challenge

Now, as the Feinberg Group seeks to obtain financing for its current project, it maintains that time will again be the toughest challenge.

“We’re happy that we finally have a starting point again,” said Daniel B. Feinberg, president of the Feinberg Group, which owns the Queensway Bay Hilton in Long Beach. “Now we have to put on our track shoes and run. . . . It’s going to be damn difficult to meet the time schedule, but we’re going to try.”

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Time has been the major complaint of many Carson officials against the Feinberg Group, which at one time was to complete the hotel before the 1984 Summer Olympics.

“The city has been patient enough,” said Councilwoman Vera Robles DeWitt. “If they don’t come through within the 90 days, I’m not prepared to continue to extend this for the Feinbergs.”

Officials have been vocal in their concerns about the proposed Hilton, not only because some have doubts about the Feinberg Group, but also because many consider the proposed development vital to establishing Carson as a hub for high-quality development.

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“I think it’s the springboard of all development on the (San Diego) freeway corridor,” said Councilman Walter J. Egan. “It’s the first major project that we’ve had since the Carson Mall. It will have an effect on the surrounding property. It will bring in the evening trade that will lead to development of a first-class dinner restaurant. It will have a dramatic impact on Carson.”

Some officials say that this week’s tentative development agreement will probably lead to construction of that image-making Hilton.

Said Egan, “I think now we gave them a reasonable time to conclude their deal and we’re probably closer than we’ve ever been. I think there is a good possibility the hotel will come through this time.”

City-Owned Lot

The proposed Hilton is to be built on a $4.7-million city-owned lot at 941 E. Carson St., previously the site of a Peyton-Cramer auto dealership. The Feinberg Group, which says it has $600,000 invested in its Hilton proposal, attributes project delays to an array of factors, including a city moratorium on construction and a feasibility study done by a would-be major lender that claimed Carson was not a suitable location for a Hilton.

Some council members, however, remain skeptical of the group’s ability to construct its development.

“I’m apprehensive based on the history of that project,” DeWitt said. “I think we have some problems with the Feinbergs responding to the city’s needs. They owe the city money (for building permits), and we’ve lost money on interest during these delays. Based on the historical information, I have some question about whether we’ve been working with the best developer.”

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Earlier this year, a frustrated City Council went out to bid for other development proposals. The City Council opted in March to give the Feinberg Group a final chance at construction after the other proposals were reviewed and considered to offer a lower-quality hotel.

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