More Controversy for Sunset Gordon Project

By Aaron Blevins, 5/10/2012


According to representatives of CIM Group, recent allegations that the Sunset Gordon project in Hollywood was re-assessed to benefit a county assessor campaign contributor and his clients will have no bearing on its construction.

The future site of CIM Group’s mixed-use project sits at the corner of Sunset Boulevard and Gordon Street. Allegations have surfaced that the property was re-assessed by County Assessor John Noguez’s office to benefit a campaign contributor. The assessor’s office denies this claim. (photo by Aaron Blevins)

The Los Angeles Times reported on May 4 that property tax consultant Ramin Salari lobbied to lower the assessed value of the five parcels, which once housed an Old Spaghetti Factory, from $14 million to $7.2 million. The property then sold for $21 million.

Salari’s home was recently raided by the District’s Attorney Office, which is probing his relationship with County Assessor John Noguez and his potential influence in securing tax reductions for his clients through Noguez.

The assessor’s office, however, said the property was re-assessed to $7.2 million because, at the time, it had no entitlements, changed ownership three times and was affected by the market crash in the third quarter of 2007.

“It’s a very complex case,” assessor’s office spokesman Louis Reyes said.

He said the original property owners, Sunset & Gordon Investors, bought the parcels at the height of the market for $21 million. The company later applied for other assessments due to a perceived decline in value in 2008 and 2009, dropping the value to $10.5 million. An assessment conducted due to a corporate transfer lowered the value to $7.8 million. CIM purchased it shortly thereafter for $21 million.

The re-assessments resulted in Salari’s clients receiving property tax refunds. Reyes said decrease in value reflected the county’s overall property valuation, which dropped, as a whole, in 2009 and 2010 for the first time in 20 years.

“[The property’s decrease in value] was pretty common, especially for someone who bought at the height of the market,” he said.

Reyes couldn’t say whether the decrease in value reflected property value decreases in Hollywood as a whole. He said the assessor’s office analyzes the market conditions of cities, not communities.

The recent development involving the Old Spaghetti Factory property supplied more fodder for community members who have been outspoken against the project.

“It’s an example of the corruption on this project from start to finish,” said Doug Haines, of the La Mirada Avenue Neighborhood Association, which previously filed an unsuccessful lawsuit to kill the project. “Why was the city going out of its way to help these people? Why did it work out so well?”

The mixed-use development will include a 23-story tower that houses 301 residences, 39,000 square feet in office space, 13,500 square feet of retail space and a 21,000 square-foot public park. It is scheduled to be completed by 2014.

Developers secured at least $9.6 million from the Community Redevelopment Agency, Los Angeles (CRA/LA), which could not be reached for comment by deadline. Haines said the redevelopment agency loaned the original developers, Gerding Edlen, more than $3 million to fight the neighborhood association is court. He said they later defaulted on that loan.

The demolition of the Old Spaghetti Factory, which occurred earlier this year, was also controversial. An early agreement with Hollywood Heritage was made to preserve the building, but under new leadership, the organization allowed CIM to preserve parts of the building while demolishing the rest of it, Haines said.

The project has 17 entitlements, which may be the most of any project in L.A. history. It has twice the allowed density, half the necessary parking, didn’t satisfy open space requirements and was 215 feet higher than zoning allowed. The property will also feature two large supergraphics.

It is located on the northeast corner of Sunset Boulevard and Gordon Street, across the street from the future Emerson College campus.



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One Response to “More Controversy for Sunset Gordon Project”

  1. Alek F says:

    I entirely support the new project.
    I’m also glad the Old Spaghetti Factory’s leftovers have been demolished, as it’s been an eyesore for years, attracting nothing more than graffiti and gangs.
    The rendering of the new 23-story building looks beautiful, modern, and attractive for the neighborhood (most of which is still blighted, and is unfortunately neglected for decades). The highrise will transform the neighborhood into an upscale, vibrant community, which is much more suitable for Hollywood than blight!
    However, from the article it’s still unclear as to when will the actual construction commence.

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