ITEM 6-N

Council Meeting 
December 14, 1993

TO:       Mayor and City Council Members
          
FROM:     City Staff

SUBJECT:  Recommendations regarding proposed Ground Floor Uses
          for City-Sponsored Mixed Use Development at 1423
          Second Street (Second Street Center)

INTRODUCTION

This report transmits information and recommendations regarding
the ground floor uses for the mixed use project being developed
by Community Corporation of Santa Monica on the City-owned
surface parking lot 6 at 1423 Second Street.  The report
recommends the approval of the proposed ground floor uses for the
project.

BACKGROUND

On April 26, 1988, the City Council and Parking Authority
approved in concept the development of a mixed use housing/cinema
project on the City-owned parking lot at 1423 Second Street.  On
January 30, 1990, in order to maximize the probability of
receiving tax credit financing, the City Council and Parking
Authority made a determination that ground floor space be
dedicated to cultural and/or commercial use, and not theater use,
and increased the density of the project from 28 affordable
housing units to 44 affordable units.

On May 11, 1993, the Parking Authority authorized the transfer of
Parking Authority lot 6 at 1423 Second Street to Community
Corporation of Santa Monica development of 44 SRO affordable
housing units on the property and receipt of a $300,000.00 lease
payment from Community Corporation.

DISCUSSION

The Second Street Center Project has now been in construction 
for five months and Community Corporation of Santa Monica is
ready to begin leasing the ground floor commercial space.  

Previous City Council actions approved in concept the development
of a "Latino Community Cultural Center" on the ground floor of
the project and directed staff to return with a proposal for the
Cultural Center or alternative cultural or commercial use if
staff determined the Latino Community Cultural Center to be
infeasible to develop.

At the direction of the City Council, the City Manager appointed
a task force to study the inclusion of a Cultural Center within
the proposed project. The task force, City staff and Community
Corporation met for 9 months to determine the feasibility of the
Cultural Center and to find a sponsoring group for the project. 
No non-profit latino cultural group could be found with the
financial resources to sponsor the proposed Cultural Center and a
City subsidy in excess of $5000.00 per month would be required to
subsidize the proposed facility.

City Staff and Community Corporation determined that inclusion of
the Community Cultural space at the proposed project is not
financially feasible.   

Community Corporation is  now proposing to lease the ground floor
space to a commercial tenant and intends to follow the C3-C
Downtown Overlay District and Bayside District Specific Plan
(Attachment A)zoning guidelines.  However, even though the C3C
District permits the following uses, Community Corporation will
not lease to:

     h)   Cleaners
     m)   Electric distribution substations
     aa)  Restaurants

In addition to the above uses, uses identified in Section 
9.04.08.20.030 Uses Subject to Performance Standards and Section
9.04.08.040 Conditionally Permitted Uses, will not be permitted
in the project.

FINANCIAL/BUDGETARY IMPACTS

No financial or budgetary impacts are anticipated as a result of
the specific actions recommended in this report.

RECOMMENDATIONS

It is recommended that the City Council approve the proposed uses
for the ground floor commercial space for Community Corporation
mixed use project located at 1423 Second Street. 

Prepared by:   Jeff Mathieu, Director Resource Management
               Paula Burrier, Housing and Redevelopment Manager
               Robert Berry, Senior Development Analyst