Santa Monica’s Week In Business

Michael Rosenthal

   Development Updates
   The proposed Target store in downtown Santa Monica was voted down by the Santa Monica City Council. Ken Genser and Pam O'Connor voted in favor of the store but were outnumbered, as the other five Council members voted to deny approval. Among the five was Kevin McKeown who quipped, "It's the traffic, stupid." 
   One of Santa Monica's largest property owners is in the process of being bought out by one of the nation's largest property owners. Menlo Park-based Spieker Properties, owner of the Santa Monica Gateway business parks on Ocean Park, will sell its North American holdings to Equity Office Properties, transferring nearly 25 million square feet of office space for $5.1 billion in cash and stock and $2.6 billion in debt. The company owns 2.8 million square feet in Los Angeles County. Equity Office Properties Trust, whose chairman is Sam Zell, is headquartered in Chicago. It claims to be the largest office property owner in the U.S. The Santa Monica purchase will increase its holdings to nearly 125 million sq. ft., with nearly 40% of its holdings on the west coast. This most recent purchase will make Equity the second largest commercial property owner in Los Angeles county.
   Herb Katz's architectural firm RTK is busy upgrading the automotive industry in Santa Monica.  First, the firm was contracted by Simonson Benz to design its new facility on Wilshire and 17th Street, and now Santa Monica BMW will use his firm for tenant improvements on 32,200 square feet at 1127 Santa Monica Blvd. Approximately $25,000 will be spent on remodelling the old Claude Short Dodge facility, recently leased by Santa Monica BMW.
   Santa Monica-based architectural and design firm Gensler will work with Joe Roth's Revolution Studios on $2 million in tenant improvements on three floors at 2900 Olympic, totalling 53,083 square feet. The site is just west of the Lantana Center. The contractor is Taslini Construction. 
   Gensler is also helping Liberty Livewire with $241,150 in tenant improvements for 6,890 square feet on the fifth floor at 520 Broadway. The contractor is RMS Group.
   Patagonia will have a run for its money when the new Royal Robbins outdoor clothing and travel accessories store opens at 1412 Montana. Robbins is best-known for his outrageously great hiking and walking shoes, originally designed specifically for the Sierra Nevada Mountain range and Yosemite Valley. Robbins is a noted climber and outdoor enthusiast. I still have several pairs of RR shorts that I use extensively when hiking and camping.
   Benihana's is coming to Santa Monica and R.D. Olson has been contracted to construct its tenant improvements. The restaurant will be located at 1447 4th Street. The remodel will include 7,000 sq. ft. on the first and second floors of the art deco structure which was built in 1927. The restaurant will feature a main dining room with eight Teppan exhibition cooking tables and an upstairs sushi bar and lounge at a total cost of $1.7 million. Ware and Malcomb are the architects.
   Business Announcements and Rankings
Xdrive Technologies Inc. (www.xdrive.com), a leading Internet storage infrastructure provider, announced the appointment of Karl Klessig as Executive Vice President. A veteran of the technology industry, Klessig will be responsible for strategic development.
   The Los Angeles Business Journal listed seven companies in Santa Monica, Marina del Rey, Venice and Pacific Palisades as among the largest women-owned business in LA County, based on year 2000 reported revenues.
   Ranked #5 was the W.I. Simonson Automotive Family of Dealerships (Mercedes-Benz, Saab and Dodge) with year 2000 sales of $108.8 million. Established in 1937, the company employs 193. Co-owners are Judy Richards and Francie Rehnwald.
   Ranked #25 was Party Planners West of Marina del Rey. The firm had $17 million in revenue and employs 30. Patricia Ryan was listed as the President and COO.
   Ranked #61 was Network Magic Unlimited of Santa Monica. The computer network integrator claims $5.8 million in revenue at its single location.   Susan Pignotti is the President of the firm established in 1994.
   Ranked #69 is Fraser Communications of Santa Monica. Headed by Renee White Fraser the firm employs 17 and grossed $4.9 million as a full service advertising agency.
   Ranked #72 was the lifestyle and internet public relations firm Murphy O'Brien, located on Stewart Street in Santa Monica. Karen Murphy O'Brien heads the 25-person firm, which was established in 1989. It reported sales of $4.4 million.
   Ranked #85 was the public relations consulting firm Casey Sayre and Williams located on Arizona Avenue in Santa Monica. Barbara S. Casey heads the 15-person firm established in 1979. It reported sales of $3 million.
   Ranked #99 was the Blaze Co. of Venice Ca., headed by Marci Blaze. The marketing, communications and public relations agency was formed in 1990 and employs 13. It grossed $2 million last year.


   Public Notices Nixed By City
   The City of Santa Monica continues to place all of its city public notices and advertisements with the Los Angeles Times. City Clerk Maria Stewart claims the City is obliged to place ads with the newspaper with the largest subscription base, though there appears to be nothing in the Municipal Code requiring ALL City advertising to be handled this way. The City has steadfastly refused to run ads with the Mirror.
   The Mirror has requested ads from the City on the grounds that our readers need to be informed. We maintain that the City is obliged to inform the residents of Santa Monica of city business in "the best way possible." which means using a variety of forms and locations. The local community newspaper would seem to be one such logical location. 
   As an added benefit, the Mirror provides, with paid print ads, free web site placement of city notices on our web site -- which attracts nearly 1,000 readers a day (or 365,000 web readers a year).


   Energy News and Views
   California Governor Gray Davis received $445,000 in political donations from PG&E and SCE and $99,000 from other power producers, between 1/1/98 and 6/30/2000. Is it any wonder Davis was slow to control the state's utilities in an effort to resolve the energy crisis? 
   On the Federal level, during the past 10 years, oil and gas interests have contributed $117,711,747 to Federal candidates and parties while environmental contributions have totaled $6,950,843. Still wondering about the motivation behind President Bush's push to drill in the Arctic National Wildlife Refuge?
   Despite criticism from other regions of the Golden State's energy consumption, California ranks 47th in the nation in terms of electricity usage. To put it another way, we use less energy per person then all but three states in the country.
   This from Oakland Mayor Jerry Brown..."Given the absence of bold ideas at the presidential and congressional level, cities and local governments must shoulder the burden of innovation." Oakland is now the world's largest green-powered city.


   Bankruptcy
   eToys has announced it will file for bankruptcy and has advised its shareholders their stock is "worthless." The company will file a chapter 11 bankruptcy proceeding within 10 days after seeing its stock fall to nine cents before the Nasdaq Stock Market halted its trading.


   Quote of The Week 
   "The California crunch really is the result of not enough power generating plants and then not enough power to power the power of generating plants." 
   - President George W. Bush