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Why I Voted Against Selling City Hall East


Why I voted against selling City Hall East last week for only $2.1 million.

I was the only councilperson who voted against the sale of the building and parking lot at 100 Long Beach Blvd last week. ( published the vote and the council agenda item and in the interest of saving space I am linking the article


This property was originally "sold" to the City of Long Beach for a value of $10 million from Southern California Edison when our current mayor, Bob Foster, was a Senior VP of SCE. (Foster actually negotiated the deal and signed the agreement.) Actually the building was given to the City in exchange for a promise that Long Beach would never leave SCE and go off and run its own electricity utility. SCE valued the building at $10 million and told the City if it ever broke its promise not to run an electricity utility, the City would have to pay SCE $10 million for the building.


For a brief time and about $1.5 million in refurbishing costs, the City used the building to house the police department while the old building was totally redone. When no longer needed, the City put the building out for sale and got an offer of $5 million. But  the potential owner backed out when a plan to move the City's Main Library to that building and for the City to lease the building from the new owner got squashed when a couple of councilmembers (oh it may have just been me) and the community rose up and said...NO.


A few years later, the building again sold for $4 million but that deal never went through.


So staff recommended another bidder and proposed to sell the property for $2.1 million.


My objections to the sale are numerous: 


1) our insurance company valued replacement of the property at $35 million -- so either we buy way to much insurance or we just had a fire sale...


2) The performance requirement placed in the agreement gives the buyer $1 million dollars if somehow the city doesn't close escrow. Even the Assistant City Attorney had to admit when I asked that this was an abnormally high amount.


3) The City was selling the property "as is" but was giving certain warranties on the property and was reimbursing the seller for vandalism done on the property before the sale was even negotiated. (And how was it that the City let one of its assets get vandalized to the point that thieves removed the copper wiring from the building?)


4) The City never put the property out for the entire real estate community to bid because management claimed it gave the city better control over what we want done with the property. Well, someone needs to go back to real estate school because the city could have required the same use of the property through a restrictive covenant.


5) And on the topic of restrictive covenant, after the vote I found out that indeed (a little real estate pun) the city was insisting a restrictive covenant that the property be used for residential apartments and some retail space. But low and behold, it is only for 10 years, which then the owner I presume will take this gem of a deal and flip it into condominiums.  


6) The Council received several letters from attorneys representing another bidder alleging the City Council violated the Brown Act and that the City should have set aside appropriate time for an administrative appeal from the other bidder. I thought we might want to wait until some of this legal stuff was worked out before we went ahead.


What do you think about this? Email me at:


Thanks for reading.