Advisory Panel Delays Vote on Playa Vista Deal : Development: An outside consultant raises questions about the complex agreement, prompting the commission to urge county officials to strengthen financial guarantees with the developer.

Los Angeles County’s Small Craft Harbor Commission has postponed action on a landmark agreement between the county and the developer of the massive Playa Vista project after an outside consultant raised questions about aspects of the complex deal.

The delay, the second in three months, again signaled the commission’s unwillingness to hastily approve an agreement that would pave the way for construction of a new waterfront community next to Marina del Rey.

After hearing a lengthy report from their consultant, commissioners made clear Monday that county officials will have to renegotiate and strengthen financial guarantees in the deal with developer Maguire Thomas Partners before they will recommend the package to the County Board of Supervisors.

The consultant, Robert J. Wetmore of San Francisco, recommended that the agreement be revised to ensure that the county is paid if Maguire Thomas defaults. In its current form, the agreement ranks the county third in line for payment, behind the banks financing the project.

The tentative agreement, reached after years of secret negotiations, calls for the county to sell a key piece of public land in Marina del Rey so Maguire Thomas can carve a boat channel from the landlocked Playa Vista property toward Santa Monica Bay.

Without access to the water, Maguire Thomas cannot realize its dream of building a multibillion-dollar marina community of condominiums, apartments, offices, shops, restaurants, hotels and boat slips as part of the even larger city-within-a-city called Playa Vista.

But since the deal was made public last fall, it has run into criticism from Marina del Rey developers who fear that the presence of a new marina next door will put them at a serious competitive disadvantage.

Marina del Rey is public land, and businesses operate there on long-term leases with Los Angeles County. One of the marina’s first leaseholders, apartment developer Jerry Epstein, launched a scathing attack on the proposed memorandum of understanding between the county and Maguire Thomas.

Epstein branded the deal as a “massive giveaway” and accused Maguire Thomas of engaging in “the grand illusion” and “the big lie” by frequently showing drawings of a waterfront community when at present they have no access to the water.

“I do not believe the County of Los Angeles should be putting up the publicly owned waterway for sale,” Epstein said. “I cannot stress enough that this deal is not only wrong, it is awful.”

In an interview after the meeting, Maguire Thomas senior partner Nelson Rising defended the project and the agreement with the county.

“There is no illusion. There is no big lie,” Rising said. “We own everything (in Playa Vista) but that access parcel, and that’s why there is a memorandum of understanding.”

For years, Epstein has urged county officials to condemn the proposed Playa Vista marina site, which was once owned by the late industrialist Howard Hughes, and use the land to expand Marina del Rey. He repeated that suggestion Monday, even though the concept has long since been rejected by the supervisors as too expensive and impractical.

Epstein reminded the commissioners that he and other marina leaseholders are partners with the county in Marina del Rey. He called the Playa Vista deal unfair to leaseholders and said that if it goes forward, the marina and the county will suffer self-inflicted wounds.

His remarks drew a sharp retort from Commissioner Louis Rogers, who told Epstein that “when you make references to preferential deals, you don’t know what you’re talking about.”

In more diplomatic tones, Robert Leslie, executive vice president of the Marina del Rey Lessees Assn., also criticized the deal. He warned in a letter to the commission that the memorandum of understanding will have “a significant negative impact on the existing marina.”

Leslie said the deal will create “an undesirable competitive situation between Maguire Thomas Partners and the county’s longstanding partners for over 30 years, the lessees of Marina del Rey.”

He urged the commission to delay action until the lessees’ own economic consultant completes an analysis of the deal in February.

But county consultant Wetmore, of San Francisco-based Keyser Marston Associates, discounted the competitive impact of Playa Vista.

Wetmore told the commission that the Playa Vista marina and its high-priced luxury condominiums would have little or no impact on residential uses in Marina del Rey. He acknowledged that construction of 750 boat slips, primarily for larger yachts, will restrain price increases for existing boat slips in Marina del Rey after substantial increases in recent years. But he said the new slips will not create an oversupply.

Because of severe economic problems in the hotel industry, Wetmore said construction of a 450-room hotel as part of the Playa Vista marina is not feasible in the foreseeable future but could pose a challenge to the marina’s Ritz-Carlton Hotel if it is ever built.

Wetmore concluded that waterfront restaurants at Playa Vista could compete strongly with Marina del Rey, depending on the type of operation.

In a 23-page report, Wetmore, who was brought in last fall after the harbor commission sought an outside review of the deal, questioned financial aspects of the proposed agreement.

Under terms of the deal, the county would sell 1.8 acres of land along Fiji Way occupied by the headquarters of the county Department of Beaches and Harbors and the Marina del Rey Sheriff’s substation.

Maguire Thomas would provide a new site and building for the county facility. The developer would also pay the county $25 million over a period of years as partial compensation for the enhanced value of the Playa Vista property becoming waterfront.

The developer would also give the county 14.1 acres of Playa Vista property for construction of a “northern marina” with 350 boat slips. Plans call for that facility to be built with a low-interest loan from the state. Maguire Thomas would lease the boat slips from the county for 99 years at favorable terms for the first 30 years.

Wetmore endorsed the basic outlines of the agreement but said it would be better for the county if the agreement were restructured to guarantee payment in case of default.

“You have a right to require whatever security you feel is necessary,” Wetmore said.

The harbor commissioners agreed, and directed county officials to negotiate the changes with Maguire Thomas.

Rising pledged to work with the county but cautioned the commissioners that “these are very complicated matters.”

“Obviously we will try to adjust the language,” Rising said in an interview later. But he added, “There is only so far we can go.”

Plans for New Marina The county’s Small Craft Harbor Commission is seeking changes in a proposed deal between the county and the developer of the Playa Vista project. The agreement calls for a new small-boat harbor next to Marina del Rey, and carving a new channel across county-owned land to give the new marina an ocean outlet. The commission wants to include an independent consultant’s recommendation that the county obtain greater financial guarantees from the developer.

Some facts about the Playa Vista marina plan:

Size of property: 139 acres

Water area: 45 acres

Boat slips: 750

Hotel rooms: 450

Residential units: 2,576