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Midtown Crossing developer asks city for another loan, of $19.2 million

May 20, 2010 | 10:47 am

Stung by the recession, one of the most prominent developers in Los Angeles is turning to the city for an additional $19.2 million to bring a long-delayed Lowe's Home Improvement store to Mid-City.

CIM Group — owner of the Hollywood & Highland mall, investors in renewable energy and a prospective bidder on 10 city-owned parking garages — has asked officials for a new 20-year loan to help it complete Midtown Crossing, a shopping center at the junction of Pico and San Vicente boulevards.

Under the proposed agreement, CIM Group would be allowed to pay off the loan by tapping property, sales, utility and business taxes that would be generated by the project once it opens.

The proposal would allow the city to keep at least 51% of the sales, utility and business taxes generated by the shopping center. Up to 49% of the remaining proceeds could be used by CIM Group to repay its loan.

That arrangement drew fire from one neighborhood activist who pointed out that sales, utility and business taxes normally go into the city's general fund, which pays for basic services such as police, parks and libraries. For months, city officials have been coping with a projected $485-million budget crisis by paring back both the workforce and city services that are supported by that fund.

The proposal for Midtown Crossing "should receive scrutiny even if there wasn't a budget crisis," said Jack Humphreville, who serves on the Greater Wilshire Neighborhood Council and frequently writes essays about the city's financial woes. "Given that the city is running a deficit, it deserves even more scrutiny."

Read the full story here.

--David Zahniser

Photo: Artist rendering of Midtown Crossing. CIM Group.