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City Council Meeting 8-17-99 Santa MOnica, California
TO Mayor and City Council
FROM City Attorney
SUBJECT RecommendatIon to Conduct a Public Hearmg on the Need to RevIse
Bayslde District Specific Plan to Protect and Foster Appropnate MIx of Retail,
Restaurant and Other Uses on The Promenade and of the Need to Enact
Interim Protections DUring the Amendment Process
I ntrod u ctlon
At Its meeting of July 13, 1999. the City Council directed City staff to suggest alternatives
for dealing WIth two concerns an overall shift In the mix of uses on the Third Street
Promenade In the direction of more retail outlets and fewer restaurants and the planned
conversion of a particular food cou rt on the Promenade Into a retail outlet ThiS staff report
responds to that direction
Background
The Third Street Promenade Isthe heart of the Clty's downtown bUSiness district Secunng
and malntamlng the Promenade's economic Viability has been a Significant municipal goal
for many years
The former Third Street Mall never attained economic success By the mid-1980's Its long-
standing phYSical and economic decline threatened the welfare of the entire bUSiness
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dlstnct In 1986, the City Council responded to this threat by adopting the Third Street Mall
Specific Plan It provided a framework for revitalizing the mall and thereby enhanCing
economic activIty throughout the downtown area
Over the next couple of years, the City made substantial public Improvements pursuant to
the Plan The pedestnan mall was redeSigned and Significantly enhanced through the
addltlon offountams, public art, landscaping, Iightmg and other Improvements This effort
created The Third Street Promenade In addition to the public Improvements, slgmflcant
pnvate development also occurred Entertamment and restaurant uses Increased
substantially, and the Promenade became an entertamment center Overall, the general
goal of revitalizing the old mall was attained However, more work was necessary to
maXimize the area's economiC success Consequently, the City returned to the planmng
process
In 1996, the City Council adopted the Bayslde Dlstnct Specific Plan which IS a component
of the City's General Plan The specific plan establishes both goals and poliCies for the
dlstnct, some general and others qUite specific For Instance, the general goals Include
attracting and accommodatmg a mix of day time and evemng uses serving both reSidents
and VIsitors Specific poliCies Include adding retail uses to the Third Street Promenade to
complIment the Influx of restaurant and entertainment uses which had prollterated over the
precedmg decade
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DISCUSSion
The Council requested staff Input on two matters FIrst, the Council asked for suggestions
for reassessing and ensunng the most desirable miX of retail and other uses on the
Promenade
Staff has begun amassmg factual Information relevant to thiS Issue and will present
currently avaIlable data at the CouncIl meeting Staff's prelimInary assessment indIcates
that, since the adoption of the Bayslde Dlstnct Specific Plan, the ten year projection for
retail growth to be achieved by 2006 has already been met Today the Bayslde District
Corporation reports that there are over 530,000 square feet In the Bayslde Dlstnct devoted
to retail The Influx In retail establishments has substantially Increased demands on City
parking facIlities Moreover, It has significantly Impacted the rental market on the
Promenade because retail faclhtles command substantially higher rents than restaurant
uses ThiS means the recent trend of increasing the concentration of retail uses and
diminishing the concentration of restaurant uses will likely continue and probably escalate
because property owners have a strong financial incentive to make the shift from
restaurant to retail
The continued expansion of retail uses has the potential to fundamentally change the
character of The Promenade and Its overall ambIence It could also undermIne the lon9-
term success of The Promenade which has as Its foundation the availability of a wide mix
of commerCial establishments which serve both the local community and the regIon
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Based upon information available as of the wrltmg of this report, staff believes that the
Council should hold a publIc hearing and delIberate on the issue of whether changed
circumstances warrant undertaking amendments to the Bayslde District Specific Plan
Additionally, If the information presented to Council suggests that the mix of businesses
on the Promenade IS likely to change so substantially dUring the course of that process as
to Imperii the Promenade's ongoing economIc Vitality, the Council should also conSider
dlrectmg staff to propose Interim measures which Will afford protectIon dUring the
amendment process, which could be fairly lengthy
At the July 13th meeting, the Council also directed staff to evaluate whether any action
could or should be taken to protect eXisting tenants of a food court who are facing eviction
because the owner has opted to change the property to a retaIl use. In response, staff
obtained Information about that Situation In 1997, pursuant to longstanding plans and
based upon the experience of operating the food court, the owner gave the tenants one-
year notice that their leases would be terminated litigation ensued, and the owner and
tenants have stipulated to a Judgment reqUiring the tenants to vacate by September of thiS
year The owner has also already entered Into a long.term lease With a retail
establishment Based upon these facts and a review of applicable legal constramts, staff
has concluded that the Council has no Viable option for either protecting these tenancies
or preservIng the present use
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Recommendation
Staff recommends that the Council hold a public heanng on the Issues of whether the
Bayslde Dlstnct Specific Plan should be amended and whether circumstances warrant
establishing intenm protections for the penod necessary to conclude the amendment
process
PREPARED BY Suzanne Fnck, Director of Planning and Community
Development
Marsha Jones Moutne, City Attorney
Barry Rosenbaum, Senior Land Use Attorney
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