So Long Solley`s - New Energy Horizons

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SAN FERNANDOVALLEY BUSINESS JOURNAL
LOS ANGELES • GLENDALE • SANTA CLARITA • BURBANK • CONEJO VALLEY • SIMI VALLEY • SAN FERNANDO • CALABASAS • AGOURA HILLS • ANTELOPE VALLEY
THE
Volume 20, Number 9
Up Front
COMMUNITY
BUSINESS
TM
May 4 - 17, 2015 • $4.00
$800 Million Project Finally Moves Forward
DEVELOPMENT: Santa Clarita
mixed-use set to start construction.
By KAREN E. KLEIN Staff Reporter
Meet the man
who wants a cut
of the surgery
business.
OF
When the $800 million Vista Canyon mixed-use
project breaks ground this quarter in Santa Clarita, it
will be the biggest development in the region since
the recession.
The 185-acre project boasts 800 apartments, 295
townhomes, 950,000 square feet of office and retail
space – and even its own water treatment plant and
transportation center.
It also could be the kickoff to a long-awaited,
much-delayed development boom in the Santa
Clarita Valley.
But the process took 15 years as its Valencia
developer battled critics who still oppose Vista
Canyon – and pose serious challenges to future projects of its size.
Most are environmentalists, unhappy because it is
Please see DEVELOPMENT page 36
Community: Rendering of Vista Canyon.
PAGE 4
So Long
Solley’s
People
Valley institution’s closure
marks end of another deli.
Kenn Phillips was
a ‘silent partner’
for years. Now he
is speaking out.
By CHAMPAIGN WILLIAMS Staff Reporter
S
PAGE 10
List
Traditions: Rosa
Ventura, a 14year employee at
Solley’s, ladles
chicken soup in
the kitchen.
tephen Sachs and his father, Jeffrey, sat
on the patio at Solley’s Deli and Bakery
noshing on eggs, brisket and fruit as they
caught up on friends, family and business.
It’s been a weekly tradition for the father-son
duo for years – though this particular meal
proved to be unsettling. Along with their breakfast, the two received bad news: their go-to hangout, a Valley institution, would soon be serving
its last meal.
“They’re closing?” said a shocked Stephen
Sachs, 35. “We’ll have to find a new spot now. I
live in Pasadena and dad lives in Beverly Hills.
Please see RESTAURANTS page 35
Money managers,
ranked by assets
under management. PAGE 12
PHOTO BY THOMAS WASPER
Startup Claims Fix for Terminal Boredom
MEDIA: ClearTV’s airport network
Photos
aimed at travelers begins to take off.
By MARK R. MADLER Staff Reporter
Check out
Palmdale’s new
Haggen Food &
Pharmacy.
PAGE 14
As far as ClearTV Media Ltd. is concerned,
waiting at the airport doesn’t need to be boring.
The Burbank company for the last three years has
programmed a fledgling television network for airports featuring news and entertainment broadcast
round-the-clock for weary passengers spending time
in the terminals.
Think of its ClearVision TV as CNN for the traveling crowd. In fact, the upstart has even managed to
win contracts at two airports – Love Field in Dallas
and Denver International Airport – that used to carry
CNN.
“They are looking for something that speaks to
passengers better and makes
for a better experience, and
that is why they are coming
our way,” boasted ClearTV
Chief Operating Officer David
Tetreault.
ClearVision TV is currently at five airports across the
nation with another three
being added this summer. It’s
Tetreault
boosted by a big partner –
iHeartMedia Inc., the San
Antonio media company that used to be known as
Clear Channel.
Still, they are going up against one of the bestknown global brands in news and information in an
industry category known as out-of-home media,
Please see MEDIA page 34
Valley Light-Rail
Proponents Refuse
To Brake Campaign
By JOEL RUSSELL Staff Writer
Despite a report last month by the L.A. County
Metropolitan Transportation Authority that recommended against converting the Orange Line
busway into a light rail line, Valley proponents of
the idea say they plan to push forward with lobbying efforts.
Valley on Track, a coalition of chambers of
commerce, neighborhood councils and elected
politicians, plans to continue to seek funding for the
conversion – which would cost well over $1 billion
Please see TRANSPORTATION page 38
36 SAN FERNANDO VALLEY BUSINESS JOURNAL
MAY 4, 2015
“This is a place where people will be able to work, live and play.
The Metrolink will allow them to hop on the train rather than drive through the city.”
JEFF HOGAN, City of Santa Clarita
PHOTO BY DAVID SPRAGUE
Open Space: Developer Jim Backer of JSB Development at site of 185-acre mixed-use Visa Canyon development, expected to break ground this quarter.
Development: Proceeding After Legal Settlement
Continued from page 1
built in the corridor of the last natural river in
Southern California. And water usage is a concern too, especially in the current drought –
though Vista Canyon will employ cutting-edge
recycling systems and drought-tolerant landscaping.“I’ve done bigger projects, but this is
by far the most complicated,” said Jim
Backer, 53, president of JSB Development,
whose involvement with Vista Canyon started
back in 2006 when he purchased the undeveloped acreage.
Designed as a walkable, transit-oriented
community that combines shopping, office
buildings, entertainment, restaurants, apartments
and townhomes, Vista Canyon is indeed ambitious. Of the 185 acres, about 90 will be developed into the largest walkable, transit-oriented
development in the Santa Clarita Valley, where
isolated, single-family tracts have long dominated and served as an example of urban sprawl.
In contrast, every one of Vista Canyon’s living spaces will be situated within walking distance of its retail-and-office main street. The
plan is to market amenity-rich, urban-style living in a suburban setting, targeting both millennials with young families and boomers
ready to leave high-maintenance homes for a
denser community and easier lifestyle.
A pedestrian trail will meander through the
community and link to a new, 10-acre park on
the east side. The bus station and a Metrolink
rail station, relocated from its current site at
Via Princessa around 2017, will make it easy
for residents to take public transit to work,
minimizing car trips.
Santa Clarita, which approved the project
in 2011 and annexed the land for development
from L.A. County the following year, is enthusiastic about the development’s forward-thinking elements and the new permanent office and
retail jobs the project could create – up to
4,000, according to projections.
“This is a place where people will be able
to work, live and play. The Metrolink will
allow them to hop on the train rather than drive
through the city,” Jeff Hogan, the city’s planning manager, said.
Legal battle
The project has certainly not been without
controversy, however.
A month after it won city approval, JSB was
sued by a coalition of environmental groups
that oppose building within the flood plain of
the Santa Clara River. Vista Canyon is nestled
just south of the river which, at 83 miles long
and with a 1,600-square-mile watershed draining the Angeles National Forest, is the secondlargest river in Southern California.
Although is it hemmed in by development
throughout much of the valley, it’s the only river
in Southern California that has been substantially untouched by development – until now.
Dean Wallraff, an attorney with Sunland
law firm Advocates for the Environment,
which represents the environmental groups,
said that the river, dry during much of the year,
flows in a wide, shallow channel during the
wet months. In order to keep the river from
flooding Vista Canyon, its banks must be built
up with concrete between La Veda Avenue and
Jakes Way.
Backer points out that the concrete will be
overlaid with dirt and planted with natives like
sagebrush and cottonwood trees, and the sandy
river bottom will remain natural. But while the
stabilizing efforts won’t look like the ugly concrete walls that line the L.A. River, Wallraff
said they will function similarly.
“The natural flood plain is more than a mile
wide and the banks wander. Developers want
to constrain the river to a narrow channel and
build right up to it because that’s the most profitable thing to do. But it’s ecologically bad for
an important ecosystem and it’s bad for
wildlife,” Wallraff said.
The ultimate irony, he added, is that Los
Angeles is now exploring a billion-dollar effort
to undo the artificial channelizing that the U.S.
Army Corps of Engineers constructed on the
L.A. River in the 1930s. “And here we’ve got
this effort to do exactly the same thing to the
Santa Clara River,” he said.
His group won the initial legal battle
against Vista Canyon in L.A. Superior Court
but ultimately lost the war on appeal. Last year,
Wallraff said, his clients agreed to a confidential settlement that cleared the way for the project to begin construction.
Big potential
Backer said his firm worked with an environmental consultant to minimize the impact
of development on the river.
“People would like the rivers to be more
natural and protected. We found ways to support that, by making (the channel) as wide as
possible – up to 800 feet – and trying to follow
the meandering nature of the river so we won’t
put in a bunch of straight (river banks),” he
said.
Backer founded JSB Development in 2000
after a career with Newhall Land & Farming
Co., which developed the master planned city
of Valencia. At Newhall, he shepherded the 12
million-square-foot Valencia Commerce
Center with business partner Glenn Adamick
and was responsible for bringing in Princess
Cruise Lines Ltd. to anchor the 3 millionsquare-foot Valencia Town Center.
Together with Adamick and partner Steve
Valenziano, JSB also developed the 165,000square-foot, six-building Tourney Place office
campus, among other projects.
Their company has so far spent north of
$10 million on Vista Canyon on design and
permitting. Once the entire development is
Please see VISTA CANYON page 37
MAY 4, 2015
SAN FERNANDO VALLEY BUSINESS JOURNAL 37
Vista Canyon: Includes Water Conservation Plan
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mist and water policy expert at the University
of California, Riverside, said that developments that already have been approved – such
as Vista Canyon – should be required to use the
latest water-conservation technologies.
Backer said his project will be cutting edge,
and will actually generate more non-potable
water than it will use because the water reclamation plant will be able to capture, treat and
reuse up to 400,000 gallons of water a day.
“We’re not adding to the water challenges
because we’re creating more (gray) water than
we’ll use on the site,” he said.
Throughout the project, turf will be used
sparingly in favor of drought-tolerant landscaping and conservation-designed irrigation
systems that will be installed along with waterefficient appliances and permeable paving that
captures irrigation runoff.
Still, upon completion Vista Canyon will
generate an estimated drinking-water demand
of roughly 200 acre-feet a year, or nearly180,000 gallons a
day, according to the
specific
plan
approved by the city.
SOLEDAD CANYON RD.
And like Vista
Canyon, it’s likely
14
that the myriad addiVISTA CANYON
tional
residential
PL AC ER
ITA CA NY
LYONS AVE.
ON RD .
developments in the
NE
WH
AL
works also will have
LA
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.
to keep a lid on water
SANTA CLARITA
usage.
Plan: The project includes a mix of houses, apartments, stores and commercial space.
5
According to a
regional economic
1 mile
a mix of traditional bank financing, individual
In 2000, local
outlook report preContinued from page 36
investors and capital raised through the EB-5 pro- residents
and
pared
by
Santa
210
gram, which allows foreign investors to obtain a environmental
Clarita, 36,171 total
complete around 2021, the cost will likely hit green card and a path to citizenship when they groups criticized
residential units have
$800 million, Valenziano said, though JSB invest in a U.S. project that creates jobs.
a report showing ample water supply for the been approved or are in the entitlement process
won’t bear all the expense.
Some of the infrastructure, including the region’s ambitious development plans, most in the region. That includes the mammoth
The plan is to begin grading and river transit center, will be funded in part by city put forward by Newhall Land & Farming Co.
Newhall Ranch. But even if that project doesembankment this quarter. Initial construction, grant money. Backer thinks the potential
The company, now controlled by Orange n’t move forward, 5,015 units are already
expected to begin late this year, will include returns over the next decade will be huge.
County developer Emile Haddad, is seeking under construction in the region and 10,217
the water reclamation plant and a 56,000“Our analysis shows that the apartment to build Newhall Ranch – which, at 20,000 res- units are in approved projects that have not yet
square-foot office and retail building. JSB market locally is 96 percent occupied. There idences and 5 million square feet of office begun construction.
Schwabe believes the current drought criexpects to sell the land and entitlements for the just haven’t been many new projects of this space over more than 2,500 acres, is Los
apartments to a multifamily developer that kind built up here,” he said.
Angeles County’s largest-ever residential sis should serve as a red flag for future development.
would start construction soon.
development proposal.
“In the past, water agencies have responded
In the second phase late next year, JSB will Groundwater questions
The development remains mired in litigamarket the 295 residential lots to one or more
The recession, of course, put a damper on tion – but not over groundwater issues. Legal to development requests by going out and findhomebuilders. And the final build-out – a town development over the past eight years, but efforts to halt it and other projects over ques- ing the necessary water for every developer.
square with six, three-story office and retail there also has long been opposition from resi- tions of water supply failed. But the severity of Now, it’s critical to have more of a back-andbuildings – will also likely be shared with dents, including an earlier court fight centered the continuing drought has not allowed the forth discussion on how those developments
impact environmental service and water supply
other developers.
on water that started before the current drought issue to fade.
Backer said Vista Canyon will be funded with emergency.
Kurt Schwabe, an environmental econo- in that district and surrounding areas,” he said.
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