City Council
Report
City Council Meeting: May 9, 2023
Agenda Item: 10.D
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To: Mayor and City Council
From: David Martin, Director, City Planning
Subject: Introduction and First Reading of an Ordinance to Cancel Development Agreement 13DEV-010 that Allowed Construction of a Multi-Screen Movie Theater Complex on the Third Level of Santa Monica Place at 315 Colorado Avenue
Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines; and
2. Introduce for first reading an ordinance to cancel Development Agreement 13DEV-010 pertaining to a movie theater complex at Santa Monica Place at 315 Colorado Avenue.
3. Authorize the City Manager to take all necessary implementing actions related to the cancellation.
Summary
On April 22, 2014 City Council approved Development Agreement (DA) 13DEV-010 to allow construction of a multi-screen movie theater complex on the third level of Santa Monica Place at 315 Colorado Avenue, following the Planning Commission’s March 19, 2014 formal review and recommendation of approval. The movie theater was subsequently built and operated and associated public benefits delivered. The movie theater ceased operations in 2020 and Macerich, the owner and operator of Santa Monica Place, anticipates the space will be repurposed for a different use rendering the Development Agreement obsolete.
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Discussion
A Development Agreement is a contract between the City and a developer that authorizes the type and amount of development that may occur within a specific period of time. Development Agreements typically provide developers with guaranteed development rights in exchange for project and community benefits. While a DA is an alternative to the standard development agreement process, in practice it is similar to other public review processes where the City Council makes the final decision with the exception that the City Council has more discretion in imposing conditions and requirements on the proposed project since a Development Agreement is voluntarilynegotiated contract adopted by ordinance.
Santa Monica Municipal Code Chapter 9.60 outlines the procedures and regulations for Development Agreements. Either the City or Applicant/owner can propose cancellation of a Development Agreement. Macerich’s formal request is provided as Attachment “A”.
The City Council is required to hold a public hearing and adopt an ordinance to approve, amend, or cancel a Development Agreement.
The 2014 Development Agreement was necessary at that time to allow for additional building height to a maximum of 84 feet for the conversion of the then-vacant retail space on the third floor into a multi-screen movie theater complex. At the time of the DA’s approval, the City’s Interim Zoning Ordinance (IZO) required the project to be reviewed through a Development Agreement since the project exceeded the height limit of the IZO but was within the 84’ height limit allowed by the Land Use and Circulation Element (LUCE). Since the approval of the Development Agreement, the height limit has been increased in the Downtown Community Plan (DCP) and if the project were to be proposed today, the height would be allowed by right and a DA would not be required.
The Council approved a suite of community benefits with the approval of the DA. The requirements associated with the physical project and environs were made:
• Colorado Esplanade: a $120,000 contribution for Esplanade improvements, extension of Esplanade features onto Santa Monica Place property, a $100,000 3 of 5
contribution towards the Downtown Wayfinding Metro Grant project, and onsite wayfinding.
• Local Hiring: a program to hire local during construction. • Sustainable Design: the project was designed to achieve LEED® Gold certification, the applicant installed photovoltaic panels on the roof, and facilitated the use of SMURF water for pressure washing of the Esplanade by installing a connection to the SMURF line.
Some community benefits were specific to a theater and are no longer applicable, including.
• American Film Market (AFM): making three movie screens available to AFM during their annual film festival.
• Kiosk on Ground Level: a theater related kiosk on the ground floor of Santa Monica Place.
Other community benefits expire and alternatives are provided to the developer:
• Local Hiring: Santa Monica Place tenants will have information on how to post to the Hire Local Jobs Board.
• Transportation Demand Management (TDM): any future employer will be required to comply with the City’s TDM Ordinance.
The tenant space that was created as a result of the DA has not been used as movie theater since March 2020. Any new uses of the space will require a separate process to determine what, if any, discretionary permits are required. Macerich is proposing a new museum in the tenant space, a permitted use in the DCP’s Transit Adjacent Zone.
In summary, City staff supports Macerich’s request to cancel the Development Agreement for the following reasons:
1) In 2014, a Development Agreement was required for projects seeking additional building height as an interim requirement while preparation of the Downtown Community Plan was in progress. Today’s DCP allows for an 84’ height for 4 of 5
additions and new construction in the Transit Adjacent Zone without a Development Agreement.
2) The terms and conditions contained in the 2014 Development Agreement are structured for a single-purpose movie theater use that is no longer in operation and therefore restrict the reuse of the vacant tenant space for other permitted uses identified in the DCP.
3) Key community benefits required by the 2014 Development Agreement were satisfied concurrently with completion of construction and operation of the movie theater.
4) Facilitating the reuse of this anchor tenant space for a visitor- and communityserving immersive art use, or other permitted use, will help support the overall economic recovery efforts of both the City and private property owners in Santa Monica’s Downtown.
The Planning Commission reviewed the proposed DA cancellation at its April 19, 2023 meeting. Following a brief discussion regarding whether it would be preferable to amend the Development Agreement rather than process a cancellation, the Commission agreed that there are unique factors associated with this site and voted unanimously to recommend that Council cancel the Agreement.
Environmental Analysis
The proposed zoning regulations are categorically exempt from the provisions of the California Environmental Quality Act, California Public Resources Code Section 21000 et seq. (CEQA), pursuant to Section 15061(b)(3) of the State Implementation Guidelines (common sense exemption) as it can be seen with certainty that there is no possibility that the cancellation of the Development Agreement may have a significant effect on the environment. Cancellation of the Development Agreement does not affect the building floor area, height or allowed uses for the existing building and therefore, no further environmental review under CEQA is required.
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Past Council Actions
Meeting Date Description
April 22, 2014
(Attachment B)
Public hearing approving the Santa Monica Place Cinemas Development Agreement
Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action.
Prepared By: Roxanne Tanemori, Principal Planner
Approved Forwarded to Council
Attachments:
A. Macerich DA Cancellation Letter Request 3-10-2023
B. SMP Cinemas Council Staff Report 4-22-2014
C. SMP Cinemas Supplemental Council Staff Report 4-22-2014 D. SMP Cinemas Development Agreement - Council Mtg 4-22-14 E. CDD-Ord-Cancellation of SMP Theater DA 050923
F. PowerPoint Presentation