Black real estate developers behind the proposed $1.6 billion Angels Landing project in downtown Los Angeles said they are refusing to continue working with Councilman Kevin De León over the secretly recorded racist conversation which he attended and said they now fear he carries a racial bias against them and has delayed city permits.
In a Friday letter to then-council president Mitch O’Farrell, two of the country’s most prominent black builders, Victor MacFarlane and R. Donahue Peebles, called for De León to resign.
They said in an interview that another council member should oversee the permitting process for the skyscraper residential and hotel complex they plan to build on Bunker Hill and complete in time for the 2028 Olympics.
The project, located next to the historic Angels Flight funicular, is in the De León neighborhood and may not be approved by City Hall without his support. But De León and former Council President Nury Martinez – who resigned last week over her role in the scandal – have declined to meet with them to discuss the project for several months, they said.
“We knew they were pushing us slowly,” Peebles said in an interview. “It’s like we have leprosy.
“We’ve been trying to meet with De León for more than seven months,” he said. “We might see Biden or Newsom sooner.”
A De León representative, Pete Brown, dismissed the developers’ objections as a negotiating tactic. He said the city council does not routinely meet with developers to avoid any appearance of favoritism or bias. His predecessor, Jose Huizar, is accused of orchestrating a pay-to-play scheme by agreeing to accept $1.5 million in bribes from developers who sought his positive voices to support their projects to have. Huizar has pleaded not guilty to racketeering, bribery and other charges.
Brown said developers are using the leaked recording to pressure the city council to agree to terms that may not benefit the public interest.
“The notion that delays on this project are the result of the Council member and not the developer’s inability to come up with a proposal that meets the standards of the City of Los Angeles and the California Redevelopment Agency is outrageous,” Brown said.
“Despite this deeply cynical ploy to gain a favorable advantage in the negotiations, the Council Office is committed to continuing to work with other city departments towards an agreement that will bring a mixed-use project to this long-vacant site; We are following our policy of significantly increasing the supply of affordable housing in all major projects.”
At the secretly recorded October 2021 call, council members Gil Cedillo, Martinez and De León discussed redistricting the boroughs with Ron Herrera, a senior union leader for the county. As Martinez made the most blatantly racist comments, a chorus of former allies and supporters are calling for De León and Cedillo to step down, including Mayor Eric Garcetti and President Biden.
For the record:
10:07 Oct. 20, 2022An earlier version of this post said Councilor Kevin de León has not commented publicly on whether he has resigned or remained in office. In television interviews on Wednesday, he said he would not resign.
In television interviews on Wednesday, De León said he would not resign. He also repeatedly apologized for his role in the inflammatory discussion.
The developers say they now suspect racism was a factor in their inability to connect with De León.
In Friday’s letter, they wrote that De León “met with us exactly once on March 28, 2022 for just 15 minutes” before the developers managed to announce at a press conference that they had secured the city’s land use rights and agreements had been secured with hotel and building unions.
“As two African Americans who have spent their careers advocating for inclusion, we find his actions offensive to ourselves and to the number of dignified, qualified, respected and proud people in our culture.”
The response that it was not De León’s policy to have direct contact with builders came as a surprise to Peebles, he said.
“Every time we asked him to meet, they said he wasn’t available, not willing to meet at that time, or we’ll get back to you,” Peebles said. “They never indicated it’s because he doesn’t meet with developers.”
The developers acknowledge that De León employees met with them as they attempted to move the project forward and strike deals on sticking points such as tax breaks for the hotel development and a provision for the city to buy back the property at an agreed price, when city officials decided to stop the project. But progress on large-scale developments usually requires face-to-face contact with city officials and project managers, Peebles said, and comes naturally in other cities where he builds. De León did not agree to a phone call or meeting, either in person or online, he said.
“It’s inexplicable,” Peebles said. “He’s either grossly incompetent, careless, or he says black people have too much.”
Allies of the councilman, many of whom requested anonymity to speak candidly with the Times, said they were deeply disappointed that De León did not object to Martinez racial slurs and describing Councilman Mike Bonin as using his black son as a prop, akin to a designer handbag.
Fabian Núñez, a former Speaker of Parliament close to De León, said “Kevin is not a racist,” but acknowledged that what he said was inappropriate and that he should have contradicted what others had said.
Peebles and MacFarlane said they were baffled by De León’s apparent unwillingness to discuss the development, which could bring thousands of construction and permanent jobs to Los Angeles and his district. The developers have promised to use union labor to build the project and staff the hotel, with agreements in place with union locals who are majority Latino members.
Developers have obtained environmental permits for construction and made affordable housing commitments, which De León sought after taking on District 14 from downtown to Eagle Rock in 2020.
Peebles and MacFarlane said they were frustrated that even after clearing the bar to obtain city building rights, they were unable to get a preliminary agreement, known as a term sheet, from the city — a necessary step towards a definitive development agreement that would allow construction to begin.
“This should have happened years ago,” MacFarlane said.
Real estate developers typically assume it will take 18 months or more to get permits to build in Los Angeles, but complicated projects the size of Angels Landing can take much longer to break ground.
It took more than a decade for developers of the Grand LA, a $1 billion complex on Bunker Hill designed by architect Frank Gehry, to receive permits and sufficient funding to begin work in 2018. The Grand’s hotel and apartment towers were completed last summer. but the retail portion with restaurants and shops has yet to fully open.
“Big, complex projects like this always take a long time,” Nick Griffin, executive director of the Los Angeles Downtown Center Business Improvement District, said of Angels Landing. “And of course we hope that our local representatives will support us to move the project forward as quickly as possible.”
Downtown office landlord Christopher Rising complained that then-councillor-elect De León failed to come forward after his newly renovated 1920s office tower on Spring Street near City Hall collapsed during the 2020 George Floyd protests of had been damaged by vandals.
“We had a $120 million redevelopment of an abandoned building in his area and he never tried to meet with us,” Rising said.
The City Council granted Peebles and MacFarlane an exclusive negotiation agreement in 2017 to develop the city-controlled Angels Landing lot at Fourth Street and Hill Street adjacent to Angels Flight. The two are majority owners of Angels Landing Partners, which is responsible for the construction and operation of Angels Landing.
Its 2.2-acre site on a bare hill was originally intended to house the third office skyscraper in California Plaza, where the second of two towers was completed in 1992. By this time, however, the downtown financial center was severely oversupplied with offices and new construction came to a standstill.
Angels Landing is said to have two hotels, one in each tower. Operators have not yet been named, but developers hope one will be a four-star hotel with 255 guest rooms and the other a five-star luxury hotel with 260 rooms.
Living at Angels Landing, including 180 condominiums, is said to be luxurious, with prices described by MacFarlane as “desirable” reflecting the cost of high-rise construction in an urban center, the excavation to build underground parking and the complex’s foundation on the steep hillside from includes Bunker Hill.
Developers agreed to subsidize rents for 78 units at various levels of affordability for low- to middle-income renters. That total includes 13 of the 252 on-site apartments and an additional 65 units at a separate location in central Los Angeles that has yet to be selected.
MacFarlane has built two upscale apartment complexes near Angels Landing in recent years, including the high-rise Park Fifth Tower next to Pershing Square, which includes a rooftop swimming pool and relaxation deck with skyline views.