S. Pasadena Hotel Plan Succumbs to Stiff Opposition

SOUTH PASADENA —  Call it a matter of “too much too soon,” says Mayor James Woollacott.

After a storm of community opposition, a proposal to build a 150-suite hotel in the middle of town is suddenly, in Woollacott’s words, a “dead duck.”

The plan, proposed by the Beverly Hills firm of Stagen Realty & Management, sailed into the city in July, just as the city’s Community Redevelopment Agency was trying to float a complex new redevelopment plan, declaring 74 acres of commercial and residential land a redevelopment area.

“It just wasn’t timely,” the mayor said of the hotel plan.

Thomas Stagen, president of the firm that built the city’s successful Bristol Farms food specialty store, has withdrawn the proposal, blaming its demise on “virulent opposition” stirred up by former City Councilman Robert Wagner.

$300,000 Tax Revenue

“If Mr. Wagner’s aim was to discourage me from building out this project, it might be said that he has succeeded admirably,” Stagen wrote in a letter to City Manager John Bernardi. In an interview, Stagen said the hotel could have brought, by its third year of operation, $300,000 a year in bed taxes to the financially beleaguered city.

The city, which faced budget deficits and service cutbacks last year, is in the first year of a 4% utility tax approved by the voters for two years.

Wagner denied responsibility for killing the plan, saying it was the community at large that had “realized that bigger is not better, that small is beautiful for South Pasadena.”

From the beginning, opponents had argued that the hotel, which would have required tearing down a row of stores along Fair Oaks Avenue, was a threat to the city’s “small-town charm.” They had threatened to carry their opposition to the ballot box, calling for a referendum on the hotel.

Now, it’s back to the drawing board for the downtown block, bounded by Fair Oaks Avenue, El Centro Street, Mound Avenue and Oxley Street. The block, which includes the Rialto Theater, was declared a redevelopment area 15 years ago. Because of community opposition, developers have yet to come close to building anything there.

Rejected proposals include a discount pharmacy, a shopping center, an office building and the hotel.

Stagen’s idea was to tear down the row of stores but to preserve the Rialto, which is on the National Register of Historic Places, and the East West Federal Bank, both of which are on the block’s corners. The four-story hotel would have been a U-shaped building, with a parking lot in the cavity of the U.

“It would have been nice,” said Stagen, who said he had nailed down financing and an operator for the hotel before withdrawing. “I don’t want to fight a referendum on the ballot. Life is too short to get into arguments like that.”

But opponents, fearing attempts by the Redevelopment Agency to seize private property by eminent domain, are not completely mollified.

Doesn’t Put Mind at Ease

“As far as I’m concerned, any developer can still come in and make a proposal on this piece of property,” said Juli Jorgensen, owner of Sonnie’s, a women’s clothing store that would have been torn down to make way for the hotel. “This doesn’t really put my mind at ease.”

Jorgensen, a member of South Pasadenans for Responsible and Intelligent Growth, which is leading the opposition to the city’s proposed 74-acre Gateway Redevelopment Project, said the group was also miffed that the city had not promptly notified it that the hotel plan was off. Stagen’s letter was dated Sept. 2, but the group did not learn about it until a week later, after Jorgensen obtained a copy from Stagen.

“Since the city is supposed to represent us, we should have gotten the information from them first,” Jorgensen said.

Woollacott said, however, that he had not seen Stagen’s letter until this week. Bernardi could not be reached for comment.

City Councilman James Hodge, chairman of the city’s redevelopment board, whose five members are the five council members, said many residents had misunderstood the city’s role in producing the hotel plan. “We neither told Stagen to come up with a hotel plan nor pushed him in that direction,” Hodge said.

He said the Redevelopment Agency had merely granted Stagen, who had expressed an interest in developing the block, 90 days to come up with a plan. “I feel badly that people think we were trying to ram (the hotel plan) down their throats,” Hodge said.

Hodge said he was willing to commit the Redevelopment Agency to a course that would forsake any condemnation of private property in order to secure other redevelopment benefits for the city, including an increased share of property taxes.

Under state law, additional property taxes brought in by new development in specially designated redevelopment areas go the city for public improvements or for subsidizing development.

“There are areas of this community that are going to have to be developed,” Hodge said. “If we can capture the tax increments, we’ll be doing the city a favor by bringing new funds in.”