A group of black businessmen, including an Inglewood city councilman, has filed a lawsuit seeking to block construction of the $120-million Baldwin Hills Crenshaw Plaza shopping center, claiming that blacks are not being given enough jobs, store leases and opportunities to invest in the project.
In the suit filed Wednesday in Los Angeles Superior Court, the African Collective demanded that blacks be given a chance to buy 50% of the developer’s interest in the 800,000-square-foot mall being built in the predominantly black community of Crenshaw. The suit also asks that blacks be given priority in jobs and in the leasing of the 120 stores planned for the mall.
“It is a question of equity,” said Inglewood Councilman Daniel Tabor, a member of the collective. “Blacks should receive a greater percentage of the management, leasing and ownership of the project.”
In recent weeks, community leaders and some black entrepreneurs have criticized the city and the developer, Alexander Haagen Co., for failing to allow blacks more participation in the mall.
Caught by Surprise
The suit names the City of Los Angeles, the City Council, the Community Redevelopment Agency and Alexander Haagen Co. The project is a joint venture between the agency and Haagen Co.
The suit by the collective--a relatively obscure group that became vocal about the mall only recently--caught the city and Haagen Co. by surprise.
“We don’t know who they are,” said Andrew J. Natker, a spokesman for Haagen Co. “They have not spoken to us, but we would be more than happy to meet and discuss all the aspects of the shopping center with them.”
Natker denied the group’s charges that blacks were not participating in the mall.
“We are not only meeting but we are surpassing our goal (of minority participation in the project),” he said. “This is counterproductive and harmful to the small minority businesses that are going into the mall.”
Of the $9.6 million in construction contracts awarded to date, minority- and female-owned firms have received $3.8 million, or roughly 42%, according to figures released by the Community Redevelopment Agency. Included in the minority contract figures are six black-owned companies that have been awarded nine construction contracts totaling $1.2 million. Also, Haagen Co. is negotiating with 26 minority-owned stores, including 22 black-owned stores.
The increased pressure on the project led city officials to announce this week that the Community Development Department will lend $2 million at low interest rates to black-owned businesses to help them lease space in the new mall, said William Elkins, a special assistant to Mayor Tom Bradley.
Elkins said the city also will hire consultants to provide technical help for blacks and other minority tenants.
“There will be significant minority involvement, and by minority involvement I mean black involvement, in this project,” Elkins said Monday at an annual meeting of the Southern Christian Leadership Conference.
The financial assistance, he added, will go to tenants “who deserve to be in the mall but who may not have the financial resources to get there.”
However, while the city and the developer said they have made progress on jobs and leasing of stores, they have been unable to reach an agreement with black investors. A tentative agreement by the Haagen Co. to sell up to half of its share in the project to a wealthy black family for $15 million collapsed in September. The city and Haagen are now talking to other groups.
“The equity issue is the main issue,” said Stanley Stain, another spokesman for the collective. “Some of the demands are in the works, but the equity issue is not.”
Stain said that more of the negotiations regarding the project should be taking place in public because the project is being funded with public funds.
“Too many decisions are being made in smoked-filled rooms. This needs to be aired in public,” he said.
In all, more than 1,000 construction workers will be needed to build the mall and about 3,500 workers to operate it. Under the joint venture between the Community Redevelopment Agency and Haagen Co. a goal was set to have 28.3% of the jobs go to minorities and an additional 6% to women.