Paper Mate sale opens up debate
MID-CITY An international real estate firm responsible for the Lantana Media Campus in Santa Monica — home to IMAX and Revolution Studios — has purchased the former Paper Mate pen manufacturing plant on Olympic Boulevard, with plans to turn the shuttered industrial complex into creative office space for the entertainment industry.
Houston-based Hines reportedly paid more than $75 million for the seven-acre property and hopes to build two-to four-story office buildings totaling roughly 300,000 square feet. The seller was a family trust that had held the land since the 1950s, according to published reports.
The complex — located at the northeast corner of Olympic Boulevard and 26th Street — is currently empty, a security guard with property manager Grubb & Ellis said.
Colin Shepherd, a Hines senior vice president, told the Daily Press on Monday that the company has been interested in the property “for quite some time,” and is looking forward to developing a quality project that will enhance the neighborhood, which is already home to the Water Gardens, MTV Networks and Bergamot Station. With the Exposition Light Rail line planned to pass by the complex, Shepherd said Hines wants to create a project that will serve as a gateway into the city.
Kevin Herrera CONTROVERSY? International real estate developer Hines on Monday announced the purchase of the old Paper Mate pen manufacturing plant located at 26th Street and Olympic. The company, which reportedly paid $74 million for the 7-acre site, plans to build more than 300,000 square feet of office space for those working in the entertainment industry. (View from Olympic.) “It is an extremely important property,” Shepherd said. “It is going to be a primary entry point to the city and needs to be beautified. It needs to be a nice, new project that will be appropriate as an entry into the city and it needs to be developed responsibly and worked within the (Light Manufacturing and Studio District, or LMSD).
“We are obviously concerned about the cities in which we work in and we are trying to create a project that is responsive to the needs of the city.”
The purchase comes as residents continue to pressure the City Council to pass a moratorium on development in the LMSD until a new Land Use and Circulation Element (LUCE) has been approved. City planners have been meeting with residents over the last several months to discuss changes to LUCE, which will determine how land is used for the next 20 years or more.
Residents in favor of a moratorium believe developers are trying to push through as many projects as possible before the LUCE is complete and want city staff to spend more time on it than on processing development agreements and permits. They fear that unchecked development will dramatically change the look and feel of their neighborhoods, bringing with it more vehicle traffic and people in need of services, which could tax the city’s infrastructure.
In an e-mail to elected officials and City Manager Lamont Ewell, Ted Winterer, a member of the Recreation and Parks Commission and a president of the Ocean Park Association, urged city officials to enact some type of moratorium, calling the Hines purchase “the canary in the coal mine.”
“We’re driving without a contemporary road map and it makes sense to apply the brakes until we know where we’re headed,” Winterer wrote.
In his letter, Winterer went on to say that the plan outlined by Hines would add a tremendous amount of office space,“further disrupting the job v. housing imbalance, while arguably adding little to the city coffers after the cost of new services to these tenants are provided.”
Wintered also mentioned the bad traffic that clogs streets like Olympic and Cloverfield boulevards during the morning and evening rush hours.
In response, Ewell said the property is heavily contaminated by industrial pollutants that must be removed before the land can be developed, which would take years.
“It is our belief that the LUCE will be completed prior to this estimated time frame,” Ewell wrote.
Paper Mate’s former owner, Gillette Co., is working on a cleanup proposal, Shepherd said.
“We obviously very much want (Gillette) to do the right thing and I think we are confident that they will,” Shepherd said. “It is important that we get the property cleaned up.”
“If they can get it approved, it will do well,” York said. “There is a tremendous demand for office space and the market is very tight. The real challenge will be how will the community react to it. There are concerns about traffic, but as of right now, the property is underutilized and is obviously not an asset to the city in its current state.”
Originally published in the Santa Monica Daily Press print edition on August 29, 2007. Read the original PDF.