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With Commission Wanting More, Miramar Developer Wants Out
It appears that the effort to revive the dilapidated cluster of cottages in Montecito that once was the Miramar Hotel has seen its third suitor come and go, but the dance isn’t over.
After a 12-hour meeting Wednesday, the Montecito Planning Commission decided to require that Rick Caruso — the third potential developer of proposal to restore the Miramar Hotel in eight years — undergo the kind of study that he had said from the beginning he was unwilling to do.
In a surreal twist, the meeting ended with Caruso — who had owned the 15-acre property along Highway 101 for 18 months — begging for his project to be denied so he could sell the property more easily.
“Let me out, let me go,” said Caruso, the billionaire developer of shopping centers and a potential mayoral candidate for Los Angeles. “I have never thought in my life I would ask for a denial of a project, but we need that for our lenders in order to put the project up for sale.”
Flustered by his request, the commission refused.
“I think your projects are beautiful, and I would love to have you here,” Commissioner Sue Burrows said.
The commission will continue the hearing on Aug. 28.
Asked by reporters after the meeting if he’s out for sure, Caruso said: “I think there is a very small chance we’re going to go forward with this.”
The proposal for a new five-star hotel at 1555 S. Jameson Lane had received the blessings of Santa Barbara County staff, the Montecito Board of Architectural Review and the Montecito Association.
But the project was nonetheless controversial, drawing dozens of passionate supporters and opponents alike.
In general, supporters said the blight by the freeway needs to go, and credited Caruso as an able developer with a proven track record who had a shot at building something that would be economically viable and aesthetically pleasing. They, like Caruso, maintained that there was no need for an EIR, because a former project to revive the hotel had been given clearance before being abandoned in 2000 by Studio 54 co-founder Ian Schrager.
Critics have said the project needs an EIR, in part because it’s larger: The Caruso project’s net floor area was about 33,000 square feet larger than Schrager’s approved plan of 137,000 square feet. (However, Caruso’s proposal included fewer rooms than Schrager’s.) They said the proposal was too large, pointing out that it failed to meet zoning requirements on matters such as height, setbacks and parking. They also worried about flooding, given his plans to fill in a flood plain.
For its part, the commission was reluctant to take most of the studies by the county staff or Caruso at face value. As such, they delved deep into the details. Suspicious that Caruso may have under-calculated the net floor area of his project, for instance, they questioned matters such as the size of hallways, or what constitutes an enclosed balcony. (Both of those items can be exempted, so there could be an incentive to exaggerate their size.)
The commission also was distrustful of the county staff’s analyses on parking and traffic. Although Caruso’s plan called for 135 more parking spaces than the Schrager plan — and, the staff reported, 75 more spots than the similarly sized Biltmore Hotel — the commission was concerned about the specific parking plan. Bierig didn’t like how it was all valet parking, saying he had a hunch that many people would forgo handing over their keys in favor of parking in the surrounding neighborhood.
Commissioner Jack Overall was skeptical of Caruso’s claim that his hotel would only require 100 employees at any given time, noting that most other comparable hotels — such as the Biltmore — seem to have considerably more. Overall wanted more information on how traffic would be affected in the event that the employee count was a gross underestimate.
The commission made the decision about the water study after hearing legal advice from county counsel. Chief Deputy Counsel Michael Ghizzoni said the commission could ask for a “subsequent EIR” on a given topic — complete EIRs study all potential effects — if the commission believed past assessments to be inadequate, or if new information had been received that hadn’t been known at the time of the earlier approval. In the case of water, Ghizzoni suggested the “new information” clause may apply, citing how the Montecito Water District recently sent out letters informing residents that the district’s supply was outstripping reliable demand.
Earlier in the day, the water district’s general manager, Tom Mosby, told the commission he was obligated to provide water to the Miramar. Mosby said refusing the Miramar would be akin to refusing to serve water to a resident who left town for 10 years and returned.
Commissioner Michael Phillips made the motion to require a subsequent EIR on water supply. “I just think we have such a huge obligation,” he said.
The meeting ended on an emotional note.
Bierig told Caruso that he believed Caruso had been led down the wrong path by some of the groups he had been dealing with.
“Our mission is to let you do a job that fits into our community, but the project does not do that,” he said.
When it became clear that Caruso wanted out, Phillips considered redacting his motion, but decided against it. At that point, Bill Palladini, president of the Montecito Association, which is essentially a gigantic neighborhood association whose recommendations carry clout but are nonbinding, stormed out of the room.
Staff members on Wednesday said the subsequent EIR could set the project back by somewhere between six and nine months. Caruso has said he is uninterested in conducting an EIR because it would be too costly and he believes all the necessary studies have already occurred.
Once a thriving hotel that catered to the famous and middle-class alike, the blue-roofed Miramar opened in the late 1800s but has been closed since 2000. In 1998, Schrager paid $30 million to purchase the property from the estate of June G. Outhwaite, whose family had owned it since 1939. Financial difficulties forced Schrager to shut down the project in 2000, and he later sold it to hotel magnate Ty Warner for $40 million. Warner, owner of the nearby Four Seasons Biltmore Resort and San Ysidro Ranch, decided that the rigors of renovating another hotel project in Montecito were too much. Warner sold the property to Caruso for an undisclosed sum a year-and-a-half ago.
Caruso was hoping to reopen the Miramar by 2010.
Noozhawk staff writer Rob Kuznia can be reached at rkuznia@noozhawk.com.
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» on 08.07.08 @ 06:31 AM
Caruso sells the Miramar to the state, which turns it into a giant commuter parking lot and runs electric shuttles to State St. and Goleta every 15 minutes. There could be recharging stations, a recycled water carwash service, newstands, a non-chain coffee shop…next to the railway tracks could be a new Montecito train stop! Gets rid of the blight, improves traffic on 101, green—all good!
» on 08.07.08 @ 06:54 AM
So SB of us to blow it like that! MBAR should be on its collective knees to Mr. Caruso. It was all just a terrible joke, Rick - we want our Miramar! We want you!
» on 08.07.08 @ 07:08 AM
Sadly, if it had only prevailed a year ago when everyone from staff planners and various other experts KNEW an EIR would be needed—-on water….by now, it would probably be done and Caruso would be moving forward with a project that actually dealt with reality as opposed to the fantasy the he, Palladini, and others somehow believed would be swallowed by the MPC. Not gonna happen. I want to thank the MPC for their courage and integrity. Something that has been lacking—- from County P&D;and CEO executives, Supervisor Carbajal and every other person who could only see dollar signs and feel the pressure from this smooth operator. I had to turn the TV off last night in the midst of Caruso’s “plea” (aka: bullying) to deny his project. Just as with the North Hills project that was rammed through by staff and Mike Brown——-this effort to do the same with the Miramar just won’t fly. Not here.
» on 08.07.08 @ 08:02 AM
As usual the county/city fathers should be ashamed. Add this to the lower State Street and Carrillo Hotel fiascoes.
Time to replace them all!!!
» on 08.07.08 @ 08:39 AM
Caruso takes his money and runs, leaving a cluttered dump of empty beer bottles, cockroaches, rats and vermin. At least the homeless, drug users and vandals still have a place to call home.
Take a walk on the property and tell me if you really want to live near that.
Warner stripped the property of trees. Shrager let the buildings crumble and become termite infested.
BTW, anyone who wants a nostalgic, termite and dry-rot infested, blue roofed cottage for free - I’m sure Caruso will give you one.
Have fun with that Montecito.
FYI - Wynn doesn’t do anything that does not involve a casino. He makes too much money in Dubai & Vegas to go through that assinine process with your city.
Marriott - is just too cheap and doesn’t build those kinds of boutique properties.
» on 08.07.08 @ 08:47 AM
If Mr. Caruso really wants to sell the property the status of the current project would not hamper that effort. If he had a viable approved project it might help in the sale, otherwise the only value to be sold is the property and it’s location. The dillapidated aging structures situated on the land are probably a liablilty at this point and would diminish the value in the event of a sale.
» on 08.07.08 @ 09:13 AM
How can anyone expect the ancient freeway onramp, offramp and Jameson to possibly handle the traffic created by this project? How could this huge project snake through the county planning offices without an EIR? Have our local planners completely lost touch with reality? Is there anyone who really beleives that Caruso will be busing his workers in and out and they won’t need parking spaces - how would that work? What a fantasy.
» on 08.07.08 @ 09:23 AM
Here’s a suggestion, let the neighbors and other dissidents but the property from Caruso. Then donate the land to the state or county and convert it to a park. No lights, no noise, no employee parking problem, no unsightly buildings and no tax income. Let these people put their money where their mouths are!
» on 08.07.08 @ 09:27 AM
If this plan had been put to a vote, it would have gone through. It seems democracy is dead and we must put up with dictators, who go against the will of the people.
What a sad state of affairs this has become.
» on 08.07.08 @ 09:59 AM
It is sad to see how the Commission chooses to find reasons “not” to approve, instead of working with this fine developer (who I have never met personally).
The water issue was addressed very clearly by Mr. Mosby, the expert and manager of the “water”. This property has a right to the water from the Montecito Water Company, historical use of the water since 1924 and the preveyor of the water explained that they have secured an addittional 1,000 acre feet to assist the Montecito situation that has been created by the homeowners, not the Hotel. Plus, the Miramar has the right to the water in the ground.
It is time to find reasons how to make this project work NOW. Mrs. Burrows was the only commissioner yesterday to start addressing issues and working them out with Mr. Caruso and he was very willing to hear the issue and come up with a solution i.e. tennis court lights and walking path at the parking at Jameson. Why not work with him instead of sitting there for hours, cutting off the Public hearing and then sucker punching this true gentlemen.
As for the speaker slips, Chairmen Bierig asks the public to please keep their comments to new issues, to be quick and then slams those of us in the audience, who put in a speaker slip and adhered to his request and did not take our 3 minutes. If I knew what issues they were heading towards I would have spoken, but the CEQA issue of water was hidden and was even a surprise to the commissioners, by the attorney until after public comment and after Mr. Mosby was told he could leave.
Is the project perfect, no, but this is not a perfect world. The devil is in the details which the commissioners could have conditioned so Mr. Caruso could move forward and Montecito and the County of Santa Barbara could begin to enjoy the benefits both financially and esthetically and the residents could begin to take pride in their gateway.
BTW: The Montecito Journal made mention of the possibility of the Chumash being able to claim this property, Mr. Caruso can you partner with the Chumash and put a Casino there which will not have to go through all the approvals? Not that any of us would want that but you can bet this smart man may give up going the friendly route sooner of later.
Did you also caught the fact the Cal Trans is already working on a new 101 proposal which involves adding a lane inward by taking out the median instead of moving outside the right of way….Montecito, maybe in 1991 you should have barked up the “make it beautiful” instead of insisting on not widening the 101. Now you will get ugly since you would not compromise and Cal Trans needs to take pressure off the traffic flow, they apparently have some money to do it but not enough money to spend to make you happy. I guess it is not all about YOU!
» on 08.07.08 @ 10:27 AM
Salud Carbajal can step up anytime now and make something positive out of this mess. The Montecito Planning Commission serves at the pleasure of the Board of Supervisors, and the Board can have any PC decision appealed to them.
The ultimate joke here is that if water is the issue, the Miramar has a historical water use - and the District Manager confirmed it. Why in heaven’s name is that going to be called into question with another silly environmental impact report?
Remember the next time someone tells you we need “local control,” this is what we get for it. More layers of government rarely serve the people better.
It’s time for leadership, Salud! We didn’t elect the Planning Commission, but we did elect you.
» on 08.07.08 @ 10:51 AM
Of course, any project applicant simply can WITHDRAW his project application and need not go through the high drama and game of seeking an outright denial as a way to save face and elevate the property selling price. The detailed deliberation a Planning Commission is how the process works, rather than sending it to the political deciders who often ignore legal, planning details and just follow the votes and the money.
The legal Process seems to have prevailed here, and the meanly slammed line-staff planners Michelle Gibbs and Julie Harris were right all along for following the law and upholding their professional ethics, a true way to Love America.
» on 08.07.08 @ 11:11 AM
This is not “local control”. This is control by a closed network of good ol’ boys and girls beholden to the Supervisor who is in turn beholden to large contributors in Montecito and to a voter base well beyond Montecito. In fact, this case might be the best argument for Montecito cityhood. The MPC is indeed appointed by the Supervisor, whose district includes many more voters than just Montecito. An elected city government would have land use control, could have an elected MPC or equivalent, which hopefully and unlike the appointed MPC would respond to the public majority. And BTW, if cityhood were approved before the Miramar property were developed, then certain revenue from the Miramar would accrue directly to Montecito rather than to the county, which should alleviate concerns, whether or not misplaced, about the “cost of cityhood”.
» on 08.07.08 @ 11:50 AM
Nice try, but Salud doesn’t lead. He spouts platitudes like “democracy is messy” while ensuring that his every utterance addresses all points of the political compass. He is the epitomy of the professional politician, focussed primarily on the next election and doing his best to accomodate his large contributors (think selected wealthy Montecito individuals). Unfortunately, politics, esp around here, is such a thankless occupation that the pool of candidates is very limited.
» on 08.07.08 @ 12:47 PM
It appears that as a community we are once again controlled by small minds with too much power. While a phenomenon not unique to Santa Barbara, it is certainly one in which some people here have developed an expertise.
I wonder if any of the people who have voted against this plan have approved ANY of the previous plans…they seem to be developing a track record…
» on 08.07.08 @ 01:11 PM
What a disappointment! The Commission seems more interested in proving their importance than in effecting a resort being built in its former elegance. No wonder Ty Warner sold it! He knows this area well. After this fiasco, few developers will even consider putting money into this white elephant.. Where is the common sense today? Betty J. Rosness
» on 08.07.08 @ 02:06 PM
I am so sorry to see what is happening to this prime location and what was once a fun place to visit. I would like to see this once thriving blue-roofed getaway restored to its original state with some upgrades. Make it fun again. Make it inviting not only to the upper-class, but a place that middle-class people can escape for a weekend as well.
It is sad to see that everyone can’t seem to work together to get the job done. I can understand Mr. Caruso’s frustration. If he continues on with this project after the Board and all the higher ups come to agreement I would hope that there is a room that I can afford and enjoy this gem upon completion. Maybe I am not in tune with what Montecito wants. I just know what I feel.
» on 08.07.08 @ 02:38 PM
I second “Here’s An Idea” - Caruso sells the Miramar to the state, which turns it into a giant commuter parking lot and runs electric shuttles to State St. and Goleta every 15 minutes. There could be recharging stations, a recycled water carwash service, newstands, a non-chain coffee shop…next to the railway tracks could be a new Montecito train stop! Gets rid of the blight, improves traffic on 101, green—all good! FAILING THAT, back to the Hobo camps!
» on 08.07.08 @ 03:13 PM
Appears that Noozhawk does indeed filter its postings. My response to Jon Martin regarding the likelihood of Carjabaj doing anything like “leading” appears to have been censored.
[Editor’s note: That’s news to me. How was it censored? Trust me, I was sorely tempted to correct your spelling errors.]
» on 08.07.08 @ 04:02 PM
That will teach him to suck eggs!
» on 08.07.08 @ 04:10 PM
It appears he only asked for the denial so that he could appeal it to the Board of Supervisors. But was he straight with us about his reason for wanting a denial? No. ______just like he appears to not be straight with us about much of anything. We should not trust this “salesman” any farther than we can throw him.
» on 08.07.08 @ 06:27 PM
My mistake. Just took a loonnnggg time to get posted. Be happy for you to correct my spelling errors. Keep up the good work - I think Noozhawk is great!
[Editor’s note: There is a filter in that the comments have to be activated, but we’re generally guarding against libel, vulgarity and gross personal attacks. By and large, our readers are respectful even on heated topics and they’re more than capable of policing others — and, for that, we are most grateful. Meanwhile, sometimes more important things arise and they keep us from our posting duties.]
» on 08.07.08 @ 07:46 PM
Yeah I think he asked for denial so he could appeal. As opposed to being tied up in MPC hell for the rest of all of our lives. That does not make it a “fake denial request”. Seems like quite a reasonable request to me.
» on 08.07.08 @ 08:46 PM
people do you forget that Caruso is a product of L.A. developer-theater——-ever watched a City of L.A. Planning Commission hearing or Council meeting?? Stunts like he pulled yesterday are part of the show….....that’s why he was so glib while performing his lines.
» on 08.08.08 @ 11:28 AM
Rick Caruso has proposed a hotel which is, in most ways, identical to the previously approved Schrager plan. The new plan is actually smaller than the Schrager plan by several rooms which is the most important indicator of a hotel’s size. The slight increase of square footage of some guest rooms, meeting space or the restaurant is obviously necessary to create viable spaces within the hotel.
The community needs to understand that Caruso is a business man and his lenders are not going to finance a project which is not entirely financially feasible. The modifications he is requesting are not arbitrary design decisions but rather necessary elements which will help make the hotel successful. This developer has the financial means and experience to create a beautiful and successful project. I predict that if Caruso throws in the towel, which appears to be a possibility, it could be another 5 to 10 years before anything emerges from that site. Any other sophisticated developer will think twice about trying to take over this can of worms.
Making relatively small exceptions for a project of this magnitude should not be construed as breaking the law as some have suggested. These exceptions are a way that the County can assist a developer to make a difficult project work. The MPC should recognize the reality of this situation. Caruso is not playing games and the MPC shouldn’t either.
» on 08.08.08 @ 11:48 AM
Does this guy seem like a typical LA delveloper?
You decide.
RICK J. CARUSO
President
Chief Executive Officer
As L.A. Business Journal’s “Developer of the Year,” the past President of the Police Commission for the City of Los Angeles, Conejo Valley’s “Man of the Year,” and the youngest Commissioner for the Los Angeles Department of Water and Power (DWP) in the city’s history, Rick Caruso has earned his reputation as an extraordinary businessman and a compassionate member of the community.
Before entering the real estate development industry, Mr. Caruso was “Of Counsel” to one of the country’s largest law firms as a member of the corporate finance department until 1988.
Mr. Caruso received a Bachelor of Science Degree with honors from the University of Southern California in 1980, and graduated from Pepperdine University School of Law in 1983 with his Juris Doctor degree. During his law school career, Mr. Caruso was designated a Brock Scholar. In 1995, he was recognized as the Alumnus of the Year from Pepperdine School of Law.
Mr. Caruso has lectured on real estate issues at the Kennedy School of Public Administration at Harvard University, the University of Southern California School of Policy, Planning, and Development, and the Pacific Resources 1997 Conference.
He has guest lectured at the Lusk Center for Real Estate Development at the University of Southern California, and the Urban Land Institute. He participates annually as a guest panelist for the International Council of Shopping Centers (ICSC). He is also a member of the Urban Land Institute and International Council of Shopping Centers.
Mr. Caruso’s commitment to developing high-quality retail centers that push the bounds of the industry has earned him numerous awards, including:
HUMANITARIAN OF THE YEAR (2001)
House Ear Institute
ICSC’S 24TH INTERNATIONAL DESIGN & DEVELOPMENT AWARD (2000)
Innovative Design & Construction of a New Project for the Commons at Calabasas
URBAN LAND INSTITUTE AWARD OF EXCELLENCE (1999)
The Commons at Calabasas
HUMANITARIAN OF THE YEAR (1999)
National Conference for Community and Justice
SHELDON W. ANDELSON AWARD (1999)
“Building Beautiful Places that Enhance our Communities”
ICSC’S 22ND INTERNATIONAL DESIGN & DEVELOPMENT AWARD, INNOVATIVE DESIGN & CONSTRUCTION OF A NEW PROJECT (1998)
The Promenade at Westlake
MAN OF THE YEAR (1997)
Conejo Valley Chamber of Commerce
GOLD NUGGET GRAND AWARD (1997)
Best Commercial Project for Retail; Promenade at Westlake
DEVELOPER OF THE YEAR (1996)
L. A. Business Journal
Mr. Caruso is actively involved in numerous community organizations and is a member of the following:
Board of Councilors, University of Southern California School of Policy, Planning and Development
Board of Governors, L.A. Children’s Museum
Board of Directors, California Medical Center Foundation
Pepperdine School of Law Board of Visitors
National Institute of Transplantation
Saint John’s Hospital
» on 08.08.08 @ 10:23 PM
It couldn’t happen to a nicer guy!
» on 08.09.08 @ 09:07 AM
Thank you to the MPC for upholding the Montecito Community Plan. The Community Plan rules were set in place by, truly, ALL of Montecito and no one wined, dined or gave anyone promises of gifts or favors for it-this was democracy at its best. The Plan is there to avoid the charms of the moment in favor of the protection of character once the excitement of the moment passes. Caruso wants a denial to go to the Board of Supervisors so that the North County majority can give him what he wants at the expense of the values that the Montecito community steadily and permanently holds dear.
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