Pushing to Get Started, Torrance Extends Talks on Housing for Elderly
Exclusive negotiations with a developer for the construction of moderately priced housing for the elderly will continue for another 30 days, but city officials will contact other developers in case the talks fall through.
City officials had hoped ground would be broken by last month for two housing projects, but are now scrambling to avoid starting from scratch and making the project an issue in next year’s City Council election.
A year ago, the City Council selected Thomas Safran & Associates of Los Angeles to build housing projects on city-owned property at 226th Street and Ocean Avenue and at Cravens Avenue and El Prado. In December the City Council approved plans for 36 units at 226th Street and made a controversial decision to allow a four-story, 78-unit structure on Cravens Avenue in Old Downtown.
Out of Character
Old Downtown residents complained that the building was out of character with the area where nearly all structures are two-story and none larger than three-story.
City officials said they, too, were concerned about density but said the need for housing for the elderly outweighed that concern.
Two weeks ago Safran told the City Council he could not provide low rents unless the city issued tax-exempt bonds to finance the projects. He also presented drawings of a modified design intended to lower construction costs. In addition, he submitted development costs of $4.6 million for the two projects, 22% over his original estimates.
Safran said he is having problems obtaining investors for the projects because of proposed tax law revisions that would lower the return on the investments. He said he had always intended to seek bond financing so that he could offer lower rents. On his proposal he indicated that he would seek conventional loans.
Raise Rents
He said he could still get conventional loans, but that would raise rents about $60 a month. The city had hoped to have rents at about $350 a month, and can contribute about $1.5 million to help achieve that goal. No decision has been made about whether that money will be used for rent subsidies or to help defray the cost of construction.
Safran is also seeking annual rent increases of 6.5% rather than increases based on economic indicators such as the consumer price index.
The City Council Community Planning and Design Committee recommended the 30-day extension on Tuesday and asked the city staff to explore the use of bond financing.
Safran will meet with staff within the next two weeks. City Manager LeRoy Jackson said he is optimistic that a compromise can be reached.
Previous Warnings
Meanwhile, John Geyer, a spokesman for the Save Torrance Committee, a loosely organized group of Old Downtown residents and merchants fighting the size of the housing development on Cravens Avenue, chastised the council for not heeding previous warnings about Safran.
“I looked at the proposals and he was not the most reasonable in terms of rents,” Geyer said. “Those numbers just didn’t seem to work well. Now we’re going to tie up the city budget for the next 30 years and we’re not going to get the quality building we all thought we were going to get.”
Geyer, a Old Downtown resident and merchant, said the issue has already become political and he will bring it up again during the next election, when Councilmen Bill Applegate and Mark Wirth and Councilwoman Katy Geissert will be up for reelection. Mayor Jim Armstrong, whose term is also expiring, is prohibited by the City Charter from seeking a third term.
If the City Council does not get the project built, Geyer predicted, “They won’t get reelected. You can be sure I will bring it up at election time.”
