A tax attorney has filed a complaint against the Los Angeles County Board of Supervisors, claiming that the county “gave away” $85 million by allowing Archstone-Smith — the trust company that recently acquired the Kingswood Village lease in Marina del Rey — to lease the county land on which Kingswood sits for an additional 20 years for $2.1 million.
The county and Archstone-Smith agreed to the additional 20 years Wednesday, March 31st.
Archstone agreed to spend $24 million in renovations to the property and in exchange the county agreed to extend the Kingswood lease 20 years for $2 million.
Earlier, on Wednesday, March 3rd, the county approved assignment of the remaining 18 years of the original 50-year Kings-wood lease to Archstone. Archstone purchased the remaining 18 years of the lease for $87 million.
Attorney Richard Fine filed the complaint against the county for receiving only $2.1 million from Archstone in the second transaction, which extends the lease for 20 years from 2022.
“Nobody just gives away $85 million, that’s just unheard of,” says.
At issue is whether the county “extended” the Kingswood lease or whether Archstone acquired a “new” lease.
County officials claim the county “extended” the term of the existing lease, but Fine says the county issued a “new” lease to Archstone and therefore should have put the lease out to bid.
Fine claims that the county did not follow state law that requires the county to lease public property at an open meeting.
There must also be an open bidding process in which the highest bidder for the land would be revealed at another open meeting, Fine claims.
“That never happened,” said Fine.
Fine is representing two nonprofit groups in the lawsuit, the Marina Tenants Association and the Coalition to Save the Marina.
Fine alleges that the 20-year lease extension for Kingswood is in fact not an extension but an entirely new lease because, according to Fine, the original lease ends in 2022 and cannot be extended.
Fine dismisses county claims that the lease is merely an extension and thus the county is not required to conduct public bidding or hold an open meeting.
Fine also dismisses county claims that the lease with Archstone-Smith did not require bidding or review because it is park land.
Fine says that the provision of law to which the county refers does not apply to the Kingswood property.
According to Fine, that provision of law applies to companies wishing to hold a rodeo or circus on county land.
NOTICE OF TERMINATION — Weeks after Archstone acquired the lease, tenants at Kingswood received 60-day notices to terminate tenancy, due to renovations of the building.
A tenant at Kingswood says Archstone offered tenants the option of moving into a vacant unit in the 623-unit complex while their units were being renovated.
Then, after the renovations were completed, the tenants could move back into their apartments, but would have to pay significantly higher rents.
“They offered us $1,000 for moving expenses,” said a tenant at Kingswood who wishes to remain anonymous.
“The $1,000 is supposed to cover moving out and moving back in. That’s just not enough,” said the tenant.
Included in the lawsuit is an injunction prohibiting Archstone from increasing tenant rents in order to recoup the money it paid for the Kingswood lease.
Many tenants of Kingswood Village are concerned about their future living arrangements, according to one tenant.
“The attitude here is not good at all,” says the tenant. “Many people here live off of fixed-incomes and they just can’t afford to pay 30 percent higher on their rent.”
The tenant says that a neighbor at the complex has been at Kingswood for 25 years and was paying $1,200 per month for rent. However, after his apartment is renovated his monthly rent will increase to $1,525.
Fine says he is requesting a change of venue for the suit.
Fine alleges that Los Angeles County pays superior court judges $30,000 on top of their salaries, and that any judge in the county would be biased.
He says he is hoping to have the suit moved to San Francisco.
The lawsuit is available for viewing at