Sale of Ports o’ Call Skytower Rekindles Merchant Complaints
Chuck Milner can’t pinpoint precisely when the Skytower at Ports o’ Call Village last worked. At least three years have passed, he says, since the tower’s elevator carried patrons 365 feet into the air for a panoramic view of the harbor.
Nevertheless, a plan by the village’s operator, Specialty Restaurants Corp., to sell the tower to a Michigan amusement park doesn’t please Milner, who has operated a gift shop at the waterfront tourist attraction for five years.
“The Skytower is a landmark and we would prefer that it stay,” said Milner, who serves as vice president for the village’s 84-member merchant’s association. “The majority of the merchants here want the Skytower left up and operational.”
The decision by Specialty, which operates the village under a long-term lease with the Los Angeles Harbor Department, to dismantle the tower has rekindled a battle that Milner and other small village merchants have waged against their Long Beach-based landlord. For years, the merchants maintain, they have been plagued by problems such as leaky roofs, termites, rotting wooden walkways, poor outdoor lighting and landscaping.
The same merchants, who believe the Skytower or another attraction is needed to lure tourists to the center, also complain that the company gives preferential treatment to larger tenants in its leasing practices. And, they say, the harbor department has largely ignored their concerns. Terry Williams, the merchant association president, said the port’s staff did not even bother to set up a meeting with him last summer after the staff began investigating tenant gripes.
Harbor department officials, who in the past have had their own troubles persuading Specialty to live up to its master lease agreement with the port, say they do take the merchants’ concerns seriously. Its investigation of the tenant complaints was completed in November and is awaiting action by the commissioners. Commissioner
Joseph Zaninovich, who recently persuaded commissioners to delay a vote on whether to grant Specialty the permits it needs to dismantle the Skytower until merchant concerns could be studied, said every complaint will be reviewed by the board.
Ron Kennedy, the port’s property manager, said that while the investigation by his staff was under way, port employees made it a point to attend the merchant association’s weekly meetings. Specific complaints voiced by merchants at the meetings were examined by his staff, he said.
Although Kennedy said he believes it would not be proper to divulge the conclusions reached by his staff until commissioners have had adequate time to study the report, he said he believes Specialty is attempting to correct maintenance problems at the center. Moreover, he said he did not know merchants wanted the Skytower saved until his staff asked commissioners to allow Specialty to take it down several weeks ago.
Not Aware of Concern
“I wasn’t aware of any concern to save the Skytower,” Kennedy said. “I mean, it has never been much of an attraction to the village since its inception, and I’m sure there could be other things that would be more beneficial to Ports o’ Call.”
William Sleeper, Specialty’s vice president and controller, said that although the company is aware that “a few merchants have continued to complain” about maintenance at the village, the company believes the center is being properly operated. As evidence, he points to the center’s vacancy rate, which he estimated at below 10%. Port officials said that rate is considered good for centers like Ports o’ Call, which typically experience a high turnover rate among smaller merchants.
Sleeper also said he is confounded by the debate over the fate of the Skytower, which the company decided to sell to Bob-Lo Island, an amusement park near Detroit, because it was unprofitable. “I am surprised anybody would raise the question we wouldn’t have the right to make adjustments to our own village facility,” he said.
Terry Williams, the merchant association president, said his group did not learn about the sale and removal of the Skytower until after Specialty announced it had signed a deal with Bob-Lo Island officials. He said merchants think the tower, which looks like a scaled-down version of Seattle’s 605-foot Space Needle minus the rooftop restaurant, should be fixed, or that another attraction, such as an amphitheater, should be built in its place. The fear among merchants, he said, is that Specialty will build more stores where the tower now stands, thereby increasing competition for existing stores.
No Replacement Plans
Sleeper said the company has not decided what should replace the Skytower, explaining that Specialty is concerned with “making sure it gets taken down first.” The company, which would have to gain approval from the harbor commissioners before it constructs anything on the site, has not yet presented any plans to the port.
Regardless of the ultimate fate of the Skytower, Williams said merchants are just as concerned about maintenance at the village. In recent years, he said, merchants have been faced with “severe” maintenance problems including not only leaky roofs, termites, wooden walkways that are in disrepair, poor landscaping and lighting, but bad drainage and wood roofs on some buildings that have not been treated with fire retardant. The latter, he said, has prevented the installation of permanent roof lighting.
“We’ve been fighting this stinking battle week after week, month after month, year after year,” Milner said.
Jackie DiIorio, owner of the Casa d’Italia restaurant said: “I’m sure the harbor department is tired of hearing us complain about things, I’m sure Specialty is tired of hearing us complain about things, and we are tired of complaining about things, but nothing is ever done.”
Sloppy Maintenance
Los Angeles Councilwoman Joan Milke Flores, who represents the San Pedro area, said she toured the village about a month ago with merchants and found evidence of sloppy maintenance. “You can see where painting has been done to the eye line, and above the eye line nothing has been done,” the councilwoman said.
While on the tour, Flores said, there was “a great deal of discussion” among merchants about the potential hazards of wooden walkways that either had not been repaired, or had been repaired poorly. “At one point, the heel of my shoe got stuck in a hole in the board.”
Williams and other merchants said another problem they have experienced is a a high turnover in village managers--a problem that Kennedy said the port has been concerned about in recent years. Milner estimates that there have been at least six different managers at the center during the five years he has been a tenant.
“They change so often, and each time they change, the new guy coming in has a whole new set of ground rules here,” said one merchant who did not want to be identified. “This causes upheavals and problems. We are constantly fighting with the landlord because of the changes.”
Foot Dragging
Other merchants complain that Specialty often drags its feet in fulfilling lease agreements. For instance, DiIorio said that she renegotiated her lease in 1982 so she could build an outdoor patio. Despite her constant pleas, she said, it was not until two weeks ago that Specialty, which had agreed to construct the patio’s bottom decking, began work.
Merchants also complain about a lease clause that requires them to pay 1% of their gross monthly revenue toward an advertising fund for the village. Although Specialty then contributes an additional 25% of the total collected, Williams said the handful of larger so-called anchor tenants at the village such as the Ports o’ Call and Yankee Whaler restaurants owned by Specialty, are not required to contribute to the fund. If the anchors, which generate the most sales of the village tenants, were required to contribute 1% of their gross, the fund would be much larger, he said.
Sleeper said he cannot comment on the specific complaints voiced by merchants, but believes the issue should not be “debated in the newspaper.” Although the company is talking with tenants and port officials to resolve the issues, he said he believes the majority of the center’s 90 or so tenants are not unhappy.
“I think historically there have been certain tenants that have continued to raise problems,” Sleeper said.
David Tallichet, Specialty’s president, was out of town on business and could not be reached for comment.
Breach of Lease
Kennedy said the port itself has experienced problems with Specialty. In the early 1980s, the company was twice found in breach of its master lease--once for not developing a section of new stores and then for not completing the new stores quickly enough. At one point, he said, the port took back 12,000 feet of land and 100,000 feet of water rights and developed them itself because of the delays.
The master lease allows the port to penalize Specialty or revoke its lease if the village is not maintained. But Kennedy emphasized that he believes the firm has lived up to the terms of its master lease, which does not expire until 2014.
In addition, Kennedy said he believes Ports o’ Call is a success based on its low vacancy rate and the money it earns for the port. The port collects about $700,000 annually from Specialty based on a formula tied to a percentage of the revenue generated by food and beverage sales, as well as sales and rentals of other items. That formula is renegotiated every five years.
“I don’t believe there is anything Ports o’ Call (management) has done that is in violation of their existing agreement,” Kennedy said. “I don’t feel there are any defaults.”
Can Do Little
Although the port’s master lease gives it the authority to approve subleases signed between Specialty and prospective village tenants, Kennedy said the port does not get involved in determining the actual terms of such leases. Hence, the port can do little--if anything--if a tenant complains about provisions in his or her sublease.
Prodded by Councilwoman Flores, port and Specialty representatives are scheduled to take a walking tour of the village today to talk with tenants. Some merchants said they are optimistic the attention will lead to a resolution of their problems, but others aren’t sure.
“When all is said and done, it’ll be interesting to see if anybody does anything but say ‘I’m sorry,’ ” DiIorio said.
