Glendale’s Redevelopment Agency Agenda Deftly Managed

Glendale, like other cities in the San Fernando Valley, has practically no industrial space vacancy. Could you explain why industrial space is in such demand and what the challenges are to meeting that demand in the metro L.A. market?

We're seeing a shift in the work environment at all professional levels. We have law firms that no longer want to be in high rise buildings in very formal settings. They’re finding that they can be in funky industrial space that’s cheaper and do just as good a job. When they put on their suits and go to court, nobody knows what kind of space they came from.

In addition to the increasing demands from the professional market, we have growing demand for industrial space coming from the media/entertainment segment of our economy. With the increase in their product, they just can’t seem to find enough pre-production, post-production, or sound stage space. So, the demand is really coming from two different directions.

We're facing the fact, however, that the demand is still not up to the point where rent levels allow new building. So, while vacancies are very low, except for DreamWorks who came in and built their own campus, demand is not yet triggering new construction.

But that's what we're looking forward to in the next six months to a year. We will be asking how we can assist and prepare for that development. We'll be making sure our public utilities can handle the new requirements—that our storm drains, sewer capacity, and everything else underneath the streets can accommodate an increased density in building.

What's Glendale's economic growth/land-use strategy? Is it, like many cities, in hot pursuit of the big box sales tax revenue? 

We are concentrating on job development. We are only 30 square miles, and we don't have any large vacant parcels that would accommodate big box development. Unfortunately, this hurts our general fund because we can't go after the huge sales tax producers like the Walmart’s and the Costco’s. 

But part of our philosophy is that the big boxes put smaller businesses out of business, so what really is the net gain? 

We do have a Home Depot. And we'll have our first electronic stores coming online within the next six months—a Circuit City and a Good Guys almost within the same block downtown. But we are unable to provide land at the cost that big box users require.

Glendale, to a large extent, seems to have led the Southern California commercial real estate recovery. Share with our readers some of the more significant projects that have recently broken ground or are being contemplated.

We have two speculative office buildings in the process of development in Glendale. The first is PacTen Partner’s Gelande Plaza. The second is a smaller office building—approximately 175,000 S.F. and nine stories—right in the center of our office market at 400 block of North Brand.

Cigna Healthplan, which is currently a tenant in Glendale, will be moving across the street to the new building. This will leave about 100,000 S.F. of vacant space in their existing building. But with the tightness of the market and with our low vacancy rate, we think that will fill quickly.

Interestingly, one of the reasons Cigna is moving virtually across the street is that the building they're in—which was built in 1986-—cannot accommodate the technology they need to handle their business functions. We're seeing this more and more-—twelve-year-old buildings that are technologically outdated.

This is a very interesting reuse challenge a lot of cities are facing: How do the architectural and development communities address the retrofit needs of 10–15-year-old buildings?

What does the financially strapped public sector do in cities like Glendale to provide the supporting infrastructure to attract and maintain businesses which require state-of-the-art technology to thrive?

Glendale has not assisted office projects in the City with any monetary subsidies. We've done traffic improvements, widened streets, and made sure that all the public infrastructure will support the projects. 

In that vein, we will be working with a private sector firm to install a fiber optic network in our City. We believe that we must assist in getting that new cable laid. But generally, it is up to the building owner to figure the best way to retrofit their own building to accommodate this increasing demand for access to state-of-the-art technology. 

In the face of rapid building obsolescence, what do you do as a City to help your main street businesses and commercial districts stay vital? 

Certainly, the laying of a fiber optic network is key for cities to remain competitive. We have a request for proposals and have evaluated five responses. The Task Force overseeing this process is expected in the next few weeks to recommend a partner for the City to join with to make sure that we have the network necessary for the next decade.

The word 'blighted' does not readily come to mind when one thinks of Glendale, particularly its downtown. So, it's perhaps surprising to some that in a market as hot as Glendale's, the Redevelopment Agency is so closely involved with so many commercial projects. Why don't you give our readers a sense of why the tool of redevelopment is needed in Glendale.

Blight is not just physical blight, it can also be economic blight, it can be incompatibility of uses. If you have a housing development next to a manufacturing plant—even if both facilities are well maintained and physically sound—that can be a blighted condition. It could be a very inhospitable living arrangement even though the physical buildings are OK.

There's an also definition of economic blight in the redevelopment law that fits some of our older buildings. We have some structures with very small floor plates on built parcels that could accommodate four to five times the current density. And with a more efficient configuration, our built environment can help provide new jobs for the community and new revenues for the City. 

By the same token, my first example of the twelve-year old-office building that can no longer accommodate the technological needs of tenants, could be considered representative of economic blight. 

Glendale had always had a modest redevelopment program. A lot of our assistance is personal—carrying papers through the permit process, helping people get through the system, explaining what to do, making sure the inspection takes place on Thursday or Friday instead of being put off until Monday or Tuesday. A lot of our assistance is hand holding rather than economic.

In your last TPR interview in November of 1996, you are quoted as follows: "Because the CRA has reduced resources, public-private partnerships are no longer based on how much the Redevelopment Agency can contribute to write-down the land, or on what kind of grant the Redevelopment Agency will provide, but rather partnerships are focused on the level of public improvements to be provided.” This quote was before Prop. 218. What Redevelopment Agency tools are in your toolbox in 1998 to support the mission you’ve assumed?

The tools are still the same. Prop. 218 affects the creation of assessment districts, which redevelopment agencies do not utilize. We have tax increment revenue that, of course, flows back into the project areas.

But what we are seeing at the State level now is the continued diminishment of redevelopment powers. There is a bill in committee right now to make any bond issue an agency seeks subject to a vote of the people. And the life span of project area has already been shortened.

We're still seeing the gradual weakening of powers, but in the last year and a half, there has been no new legislation to change the operative laws from the State level.

You also offered in that interview the following observation on rail: "We are very supportive of rail, particularly light rail—we are nearly at capacity on our local and regional streets. If we are going to increase our capacity for job growth, it must come through rail or transit.” Where does Glendale sit now in terms of the policies/priorities it wishes to pursue regarding rail?

That statement is still valid. The MTA has, for now, discontinued all future light rail projects. But we are working with Metrolink to increase the number of trains we have every day—morning, mid-day, and evening—to provide service to more of our employees. 

We are also pursuing a second Metrolink station in the Grand-Central area. It would be somewhere south of Sonora and north of Grandview, an area that is becoming a very large employment center. It's where DreamWorks already is, and where Disney is proposing to add some development to its existing campus. 

Metrolink has been very cooperative in working to add more trains. We're fortunate because we're a stop on the way to the Burbank Airport, which becomes increasingly important as more and more transit is provided to Burbank Airport from Downtown. 

We're also working with a San Fernando Valley coalition to get more trains to come through the Valley to Downtown L.A. We’re a natural stop along that route, as well.

We are still very committed to our Beeline (local) bus system, which meets every train coming into Glendale and provides either a free ride (if you have a Metrolink pass) or a $0.25 fare into both of our employment districts.

We still know that transit is the key to more job development.

What is Glendale's view of its inter-dependent relationship with the rest of the San Fernando Valley? Is it one for all and all for one?

We have joined the Economic Alliance of the San Fernando Valley. We were the first city aside from L.A. to join as a formal member. Our Mayor serves on one of the Alliance’s committees, and our Redevelopment Agency Chair serves on another committee. Another Agency member represents economic development. 

Glendale has always been lost between two valleys—the San Gabriel Valley and the San Fernando Valley. We're not completely a part of either, and we're not really a part of Los Angeles. But we're very hopeful about the San Fernando Valley Alliance, and we're pleased that they have extended their sphere of influence this far to the east. We are working with them and watching very closely to make sure that we have status equal to that of the other cities that have joined that coalition.

We see that there are tourism opportunities in the Valley. And there certainly are great job development opportunities. The Valley has a lot of attributes that have been overlooked in the shadow of names like Hollywood or the reputation of Los Angeles. We've been working very closely with Economic Alliance President Bill Allan and have good hopes for the coalition. 

But we certainly will be evaluating in this budget cycle whether we renew our membership for next year. 

Lastly, is Glendale still cleaning the City or Los Angeles' clock when it comes to attracting and retaining business. What constructive lessons in economic development do you have to offer your neighbor? 

We're still getting a good share of the businesses that want to relocate within the Los Angeles region. The reason is we provide a traditional downtown setting where you can walk to a lot of services, you can live close to your job. In some areas of Los Angeles, that's just not possible. 

With the 'greening of America' and the retreat to a more convenient way of life, we offer the ability to live and work in a more attractive setting. Some other locations just can't compete with us.