A plan to sell some storefronts at the downtown shopping center the Exchange but keep the Alex Theatre, an Americana at Brand open space and the building slated for the Museum of Neon Art was approved by a board of city, county and school officials this week.
The city has to liquidate properties once owned by its defunct redevelopment agency as it continues to dissolve that program. State law requires transfer of the money and property once owned by redevelopment agencies throughout California to state coffers in order to close a multi-billion dollar budget gap.
The plan, approved at a City Hall meeting Wednesday, now goes to the state Department of Finance for final approval. H.D. Palmer, spokesman for the department, said it could take up to three months before a final ruling is made.
Although the plan to keep most of the 11 former redevelopment properties passed the Oversight Board, one of the seven members continually questioned the decisions to value some buildings, such as the Alex Theatre, as worth zero dollars.
“It boggles my mind that one of the most expensive properties has no value,” said Oversight Board Member Albert Abcarian, who represents the county of Los Angeles.
If properties are sold, the money from the sale will be distributed to the state and other agencies, such as the county and school district.
Other properties to which the city assigns no value include the open space at the Americana at Brand and the parking lot by the U.S. Post Office in the 300 block of E. Broadway.
Phil Lanzafame, Glendale's officer for economic development, said the properties were assigned no value because the Alex Theatre operates at a loss and is limited to civic uses by city regulations, the parking lot is too small for a developer to reap any real gains, and the open space must be used as a park per city agreements.
Although the Department of Finance has final say, it's unlikely that properties the city is slated to keep would be cherry-picked for a sale.
For example, the Museum of Neon Art, which is set to open in 2014, has an enforceable contract with the former redevelopment agency to renovate the property across from the Americana.
“I can't imagine they have the authority to order us to sell the property contrary to the Oversight Board's direction and in violation of the enforceable obligation,” Lanzafame said. “In a worst case, they might reject the entry and ask us to bring it back to the Oversight Board for reconsideration, but our agreement is clear that we have to lease the property to MONA.”
In addition to selling storefronts at the Exchange, officials also signed off on eventually selling a parking lot at 225 W. Wilson St. for $3.37 million in 2014 to become a Courtyard Marriott hotel. They also plan to give away the building housing the Panda Inn restaurant that same year at no cost to make way for a 5-screen Laemmle Theater, 10,000 square feet of ground floor retail space and 42 apartment units.
The city will also use former redevelopment money to pay for site improvements and subterranean parking. Both project plans have already been improved by the Department of Finance, according to a city report.