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Tuesday, Aug 9, 2022
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Glendale

By JOYZELLE DAVIS Staff Reporter The city of Glendale long has prided itself on its business-friendly environment. With no business license tax and nominal development fees, the city has become a thriving office market and a magnet for development activity. But along with growth comes an unpleasant byproduct: traffic. For the first time in the city’s history, government officials are considering a traffic mitigation fee for commercial developers. The fee proposal spins out of Glendale’s Greater Downtown Strategic Plan, which the city enacted last year to create a blueprint for growth. It comes at a time when some politicans and homeowners are increasingly concerned about the pace of new development in the city. “We need to be more reasonable in development we approve,” said Glendale City Councilman Dave Weaver, who was elected earlier this year on a slow-growth platform. “What’s the doggone hurry? Other council members seem to fear that the developers will go elsewhere if we don’t accommodate them.” Weaver and others fear that the city’s infrastructure is already strained at its current capacity. Cars stack up at the on- and off-ramps to the Glendale (134) freeway, and it’s rare that a rush-hour motorist can make it through a downtown intersection in one try. With two new retail developments and three new office projects in the works, some warn that downtown traffic will soon be at a standstill. “One hand washes the other, ” said Glendale City Councilwoman Ginger Bremberg, who supports the idea of traffic mitigation fees. “If the city doesn’t have good services, no business is going to want to come here.” The development fee is designed to offset some of the traffic impacts. Funds from the fee will be used for such improvements as building a $7 million parking structure on Orange Street, widening streets, and expanding the city’s Beeline shuttle bus service, according to Jeanne Armstrong, director of development services for the city. City officials are meeting with developers and business leaders to discuss formulation of the fee schedule. The formula, which determines what types of developments will be assessed, should be ready for City Council review by early next year, she said. Not surprisingly, the idea of an additional $1 to $5 per square foot cost to new office projects doesn’t delight the real estate community. “I’m surprised by this, actually, because Glendale has always done a good job of appealing to its businesses,” said Bill Boyd, senior vice president at CB Commercial Real Estate Group in Glendale. He noted that developers already have to provide traffic improvements for the area immediately surrounding their projects, and an additional hefty fee would be “onerous.” Developers point out that Glendale has historically been a “speculative” development market, which means that buildings are constructed without tenant pre-lease agreements. The developers say they ultimately will have to pass along the traffic mitigation fees to their tenants through rental increases, which could “put a project at a competitive disadvantage,” said Nyal Leslie, a partner at PacTen Partners, the firm that is developing the 500,000-square-foot speculative Glendale Plaza project. The proposed fee would not affect PacTen’s current project, but the firm is one of three finalists for the city’s development site at 800 N. Central Ave., which would be impacted. Furthermore, the developers argue, the tax revenues generated by attracting new businesses to Glendale would far outweigh the money that could be generated from a one-time fee. Armstrong acknowledged their concerns, but said she doesn’t think developers will storm out of the city in protest. “Burbank and Pasadena and L.A. all have transportation fees we are not on the cutting edge,” she said. “All the cities we know and love that have experienced growth have found themselves in this position.” With a vacancy rate of about 5 percent for premium space and 10 percent for second-tier space, Glendale is a popular market for development projects. Developers talk about an estimated 1.6 million square feet of new office projects, although only 530,000 square feet excluding the city’s redevelopment site have made significant headway through the approval stage. Glendale-based Howard Platz Group has submitted for building permits to construct a 170,000-square-foot office building at 400 N. Brand. Phase II of Westmark Realty Advisors’ Glendale City Center, a 360,000-square-foot office tower, just received conceptual design approval, according to city planning officials. With all this development in the pipeline, now is a smart time for the city to institute a traffic mitigation fee, according to Larry Kosmont, president of Kosmont & Associates. He noted that Glendale suffers from “ridiculous” traffic downtown, and the city “needs to buy itself a long-term solution to the problem,” he said. “Even if the city doesn’t have any further growth, it can hardly handle the capacity,” Kosmont said. “And that puts the city at a competitive disadvantage.” Although a traffic mitigation fee is new to Glendale, it isn’t new to the region: 42 percent of all cities within the L.A. basin charge a development fee, Kosmont said. Most cities charge a zone-specific development fee, such as Glendale’s downtown plan. Burbank is the only city to have a municipal-wide traffic fee, which it instituted in 1993 when it was in the process of approving the master plans for the three entertainment studios located in the city. With the J.H. Snyder Co.’s 585,000-square-foot Media Center breaking ground last month and more than 2 million square feet of office projects in the works near Burbank’s airport, the city’s fees apparently have not scared off developers.

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