Blogging Bayport Alameda

November 14, 2013

Charles Co. in charge

Filed under: Alameda, Alameda Point — Lauren Do @ 6:04 am

So based on the public discussions from the City Council around these innovative developers that are going to “wow” us all with their exciting and innovative plans for Alameda Point that can’t be discussed publicly lest someone steal their idea (or something like that) I’m getting the sinking feeling that at least one of the two developers — Charles Co. — might be here to stay since they’ve had not one, but two closed session agenda items to talk “price and terms”.

Finding information about Charles Company has proved to be rather difficult.

Here are a pair of older articles about a strip mall Charles Co. owned in Las Vegas .  In this case the owner was technically Tropec LLC which is owned by the owners of Charles Co.: Arman and Mark Gabay.  The first article details how the strip mall was left to languish without leases renewed:

The owners of the Tropicana Center strip mall have either $61 million to burn or a secret plan.

The mystery businessmen bought the shopping center for many millions nearly three years ago and since then have all but encouraged businesses to leave.

Leases generally aren’t being renewed, the trees in the parking lot have been cut down and most nights the lights in the parking lot don’t work.

The deed says Tropec LLC. But if you look at an SEC filing from when it took out a $56 million loan to buy the shopping center in 2005, two names appear, Arman and Mark Gabay. The Beverly Hills, Calif., businessmen have a combined net worth of $432.5 million and hold 54 properties, the loan prospectus notes.

On this particular property, 30 out of 48 storefronts are empty. And it can’t be just the economy. Other stores along the street seem to be doing just fine.

In 2009 the bank foreclosed on this particular property:

Lenders are foreclosing on the Tropicana Center and the adjacent Pecos Plaza and are seeking appointment of a receiver to run the strip mall until the property is sold at auction.

Wells Fargo Bank, trustee for investors in the property’s $56 million mortgage loan issued in June 2005, said in a lawsuit this week that shopping center owner Tropec LLC of Los Angeles stopped making payments on the mortgage in March.

Also in 2008 the Gabays played hardball on a site in La Puente:

Charles Co. owner Arman Gabay said Wednesday he had previously offered the city $23 a square foot, but that was under the impression that the project would include Triangle Square.

Now, Gabay is pegging the project without that site – since it has not yet been acquired – meaning the retail center will likely only include two big box stores and a parking lot, he said.

Mayor Louie Lujan said Gabay ‘s $23 offer was made long ago, and the council knew going into the 45-day stay that Gabay had dropped his offer to $13 a square foot.

Which they eventually developed into a shopping mall (let me tell you the rabbit hole I went down trying to find out what happened to this property), using redevelopment funds:

The project has been in the works since 2005 when the La Puente Redevelopment Agency bought the lot for $12.5 million.

The process has dragged on for years as officials solicited competitive proposals from developers and negotiated and changed agreements.

The city’s redevelopment agency, in partnership with Jasmine Real Estate Investments, a subsidiary of the Hollywood-based Charles Co., is now building the development after the agency sold it for $4.2 million.

Although this letter on this blog is pretty funny from 2008 where the Charles Co. sent a letter about the La Puente site to a different City because they had sooo many developments happening they could keep track of which city they need an extension in!

Another stalled development from 2009 in the City of Hawthorne, the Charles Company owner claimed that the stall was due to the City Council not his fault.  Interestingly enough he offered to bring a Wal-mart to that property too.

Charles Co also built a Wal Mart in the town of Altadena and have proposed another big box retailer in the same town at a different site which folks have assumed with be yet another Wal-Mart.

And finally, this is the most um, “innovative” project I could find, which is slated to open tomorrow the Gran Plaza outlets in Calexico.   This has been in the works since 2002.  You can take a look at the marketing brochure to retailers here.

Essentially from some very cursory internet searches what I get from Charles Co. is: stalled developments, strip malls, Walmart, and outlet malls.   Yay?

 

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17 Comments »

  1. More like “oy vey”!

    Comment by Denise Shelton — November 14, 2013 @ 8:58 am

  2. Great, strip malls. Now we can look just like Hesperian Blvd in Hayward! Aim high, Alameda.

    Comment by Kristen — November 14, 2013 @ 9:05 am

  3. Their home page description of their company speaks volumes: “Founded in 1979 on the pillars of family values and fortified with astute business tactics…”

    Comment by Richard Hausman — November 14, 2013 @ 9:31 am

  4. The Grand Plaza at the Calexico border is a sham. It has to keep being under construction to mask the tunnel digging.

    Comment by Jack Richard — November 14, 2013 @ 9:37 am

  5. #4 So you are saying this might all be a plan to finally get that tunnel extension to BART?

    Comment by notadave — November 14, 2013 @ 10:19 am

  6. And due to delays in their Hawthorne expansion, the folks behind the Charles Co. are quite generous with political donations:

    http://www.dailybreeze.com/general-news/20111105/money-pours-into-hawthorne-mayors-race

    Additionally, the Wal-Marts mentioned above are sometimes of the “Wal-Mart Neighborhood Market” variety that are meant to get into smaller spaces than a super store.

    So yeah, even more local political developer fun down the line in 2014.

    Comment by Dave S. — November 14, 2013 @ 11:47 am

  7. Luckily Alameda Point is subject to the super center big box ordinance that was passed several years ago – so we won’t be seeing a Wal-Mart at Alameda Point.

    One note about project delays — there were numerous project delays after the 2008 global financial crisis. Even our beloved Catellus delayed their project for several years. Marketing timing determines when projects get off the ground – and 2008 was a game changer for most developers.

    # 6 – Regarding political donations – you obviously are not from Alameda and are trying desperately to sabotage our efforts to develop Alameda Point. Please go away!

    Comment by Karen Bey — November 14, 2013 @ 4:17 pm

  8. I meant to say market timing, not ‘marketing timing’.

    Comment by Karen Bey — November 14, 2013 @ 4:18 pm

  9. Reply to #7:

    I have a vested interest in Alameda Point since I also live in Bayport. I’m not against developing the Point per se, although I’m not a big fan of some of the development choices that have been made of late.
    I genuinely like the Target area and the surrounding planned stores at the Landing, but I’m not a fan of the planned InNOut.

    I realize I won’t like every development decision made, but for now, I’ll try to call ‘em as I see ‘em.

    The closed session “engagements” between Charles Co. and the City Council started exactly one day after the Planning Commission settled some of the parcel zoning. That seems a bit… well, closed.
    And talking on “price and terms” before anyone outside of the Council can hear about it …?

    Hopefully, maybe we will all be pleasantly surprised with what’s planned. I acknowledge that it’s possible. I just see it as less likely of late.

    The only thing we can base our assumptions on what could be developed would be prior works and/or activities by the company (and by extension, their principals) in question.
    Hence my mention of the principals activities in other cities just as Lauren has done above.

    And the information that is out there on the Internets is less than comforting.

    That said, I am curious about the big box ban you mention – I’ve heard about it before but I’m unfamiliar with the specifics.
    Can anyone tell me – does this ban only apply to the super-center sized locations or ANY offerings from a big box retailer?

    Comment by Dave S. — November 14, 2013 @ 6:20 pm

  10. Why not just make Alameda Point one giant cesspool of public housing? Doug Biggs can run it. We can house the entire Bay Area’s homeless while the rest of Alameda pays taxes to support it. It will work perfectly, since the homeless won’t have jobs and won’t need cars.

    Comment by Ashkenazi — November 14, 2013 @ 8:10 pm

  11. 10. AshkeNAZI ( DH?) the cesspool is in your skull, i.e. shit for brains.

    Comment by MI — November 14, 2013 @ 9:06 pm

  12. Alameda’s Large Format Retail Ban (aka Big Box Ban) went into effect in 2008, does not include Harbor Bay or Alameda Landing because of existing development agreements. Any business of 90,000 sq ft or more of floor space with more than 10% of non-taxable merchandise is prohibited.

    Comment by Lauren Do — November 15, 2013 @ 5:46 am

  13. Frank Matarrese’s My Word piece in today’s Alameda Journal is worth a read. http://www.insidebayarea.com/opinion/ci_24518476/my-word-alameda-point-zoning-decisions-crucially-need

    Comment by Loyal Opposition — November 15, 2013 @ 8:39 am

  14. Except for the fact that the City has been working on draft zoning ordinances for Alameda Point for a while now. I mean Frank Matarrese can say it should do x, y, and z but I’m not so certain that the proposed zoning is not doing exactly what he is asking for. Single Family Residences are already mostly limited to one area which is the area that there are currently single family residences. In fact, for the housing concerned out there, I broke down the zoning sub-areas into their residential potential here.

    Comment by Lauren Do — November 15, 2013 @ 8:53 am

  15. #10: Please go back in your cave, Ashkenazi. We do not need any more evil posts like yours in Alameda.

    Back to the topic du jour…

    3, 4, 6: Charles Company sounds vaguely reminiscent of Suncal. If they are in any way similar, they can leave any time–WITHOUT an exclusive negotiating agreement. (Karen Bey, we do NOT need a repeat of Suncal here–and I ought to know…)

    Comment by Jon Spangler — November 15, 2013 @ 4:12 pm

  16. Hawthorne, CA, just elected a new mayor–its third in 4 years–on November 6. Former Mayor Juarez, who won in 2011, is the second mayor in a row suspected of or convicted of corruption. From the Daily Breeze in 2011 (http://www.dailybreeze.com/government-and-politics/20131106/hawthorne-voters-called-for-big-changes-in-election):

    “The Hawthorne Police Officers’ Association is another major Juarez supporter. The union spent about $100,000 on election materials for its slate, which includes Juarez and two City Council candidates.

    Arman Gabay, owner of Charles Co. – which owns Hawthorne Plaza mall – and president of Excel Property Management Services Inc., has donated about $50,000 through his companies to campaigns supporting Juarez. [Gabay is a principal in Charles Co.]

    Gabay’s representative, David Carlat, a Charles Co. consultant, said Gabay strongly opposes Vargas because of his connections with Guidi.

    ‘Arman is convinced he’s perpetuating the same corrupt, do-nothing council,’ Carlat said. ‘Alex Vargas basically begged Arman to support him and, if (Vargas) hadn’t allied himself with the currently corrupt mayor, (Gabay) might have.’ ”

    It’s a good thing that Alameda does not have a strong current tradition of political corruption…

    Comment by Jon Spangler — November 15, 2013 @ 4:30 pm

  17. 16: CORRECTION: The quoted copy from the Hawthorne Daily Breeze in #16 is from their 2011 election contributions story during the race between former mayor Juarez–who was just defeated November 6 and is under a cloud of suspicion for taking bribes or other corruption–and Council Member Vargas. (ousted Mayor Juarez was funded by Arman Gabay of Charles Co. in the 2011 campaign. “Family values,” indeed…)

    The 2011 contributions story is here: http://www.dailybreeze.com/general-news/20111105/money-pours-into-hawthorne-mayors-race

    Newly-elected Hawthorne mayor Chris Brown, 32, has his hands full and I wish him well.

    Comment by Jon Spangler — November 15, 2013 @ 5:08 pm


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