Blessings from Blessings

By Montecito Journal | July 30, 2024

Dear Montecito Journal,

Thank you. Woof woof! My dog friends saw me in the paper and now they all want to be Top Dogs too!

The MJ offices had a special visitor this week

Blessings

The Need for Affordable Housing

Montecito needs affordable housing. The Miramar is doing it the right way. Hard-working employees deserve the chance to live near their jobs. That basic fact is what’s behind the Caruso company’s plans for the Miramar hotel. Caruso is offering to create 26 attractive apartments for their employees at very modest rent levels – for many employees less than $900 for a studio and less than $1,400 for a two bedroom. And, contrary to some of the misinformation circulated in our community, workers at the lower end of the income spectrum will be able to access all 26 units at these rental levels. For Montecito that means fewer cars on the road and new neighbors with solid jobs who have vested interest in our community. For the employees themselves this opportunity could be life changing. It’s inevitable that a small number of critics are trying to tarnish this proposal. This is a long-term investment that will honor our community. I personally am grateful that the Caruso Group will be the developer of record. As part of a high-quality Santa Barbara – based development community for 40 years I can’t recollect ANY regional development group with the class, experience, reputation and financial strength to match Caruso – not to mention their ability to weather the worldwide
banking uncertainties.

Wayne G. Siemens

The Many Fallacies of the Rosewood Miramar Housing Plan, Part II

In the MJ July 11-18 issue, I pointed out the first three of several fallacies of the Rosewood/Miramar project proposal, where the plan includes 26 units of “affordable housing” for employees. This housing – in a 40 foot-high, three story building on the east side of the property, tucked between the freeway and a large parking lot, very close to Oak Creek flood zone – is said, by its developers, to justify a new high-end two-story Shopping Mall/Luxury Apartment complex and restaurant, with a massive 20-foot-deep underground parking facility, on the west side of the campus. This intrusive commercial development is to be plopped into a long-standing residential area, near homes, a venerable church, and a senior center.

I showed the income bands for the various categories of employees served by “affordable housing” in our county (less than $59k = very low income; $60-95k = low income, and $96-142k = moderate income.) The Rosewood/Miramar’s intention is to divide up their housing into roughly a third of the units for each of the income brackets. I gave examples of various sorts of jobs over there in each bracket.

To recap, the first fallacy they have tried to foist on our community is that the housing is mostly for the benefit of the lowest earning employees, such as housekeepers, bellmen, valets, gardeners, custodians, line cooks, busboys, and the like. It is not. In fact, out of about 125 employees at that level, only 9-12 of them, a small percentage, will have space allocated in the new housing. Two-thirds of the units are designated for workers making $60,000 to $142,000 salaries, ie., more than $28.80/hour. That would be managers, supervisors, administrators, executives, and other white-collar employees. As far back as summer of 2023, Rosewood reps spoke about their lowest blue-collar workers as justification for their grandiose development.

The second fallacy is that “they need the new mall to pay for the housing.” This is also untrue, inasmuch as they could easily fund the housing through a) the rents they will charge employees; plus, b) ongoing revenue from the hotel operations which, even if 40% of rooms are unoccupied, generate a million dollars per week in gross receipts; c) the owner, Mr. Caruso, has large reserves of cash from his several other lucrative Southern Calif. shopping mall businesses where rents are highest in their class; or d) borrowing the funds (less than $10 million) from one of his existing creditor institutions, or his extensive credit lines, or from his other limited partners.

The third fallacy is that they are not taking government subsidies for the project. No, of course not, up front, since Caruso Affiliates is a “for-profit business,” not a “non-profit.” They are not even eligible for subsidies! They did not mention that. However, once completed, they can apply for the Low-Income Housing Tax Credit, tax write-offs, depreciation, and many other deductions that save them many thousands in taxes. Furthermore, they will not pay any TOT to the county on apartments rented over 31 days. There are teams of accountants who are figuring out how to do this, rest assured. Do not doubt that they are proficient at serving their own financial interest.

The Fourth Fallacy Caruso’s reps often repeat is that the project is “ >70% Affordable.” Again, this is open to interpretation. That figure is true if you look at how many front door keys will be needed for the housing versus the lux apartments: 26 vs. 8. But is it fair to compare 17 compact studio units, three small one-bedroom units of 450-750 square feet each, and a small number of two-bedroom units, with eight Luxury Apartments varying from one to three bedrooms, and 1,000 to 2,000 square feet each? Total square footage for the 26 “affordable” units is about equal with the eight “market rate” apartments. So if one were to go by square footage, now the ratio is more like 50%/50%.

If you look at the units economically, the affordable units will generate about $45,000 per month rent, and the “market-rate” apartments will bring in about $180,000 per month, making them more than 4 times more valuable to the owner. Now we see the ratio, economically speaking, is 20%/80%. So, telling people that your project is 70% affordable is not quite telling the complete story.

The 5th fallacy, a “selling point” of the west end project, is that of a “grab and go coffee shop.” To begin with, there already exists a cafe in the main building where you can get coffee “to go” if need be. Secondly, to get your coffee at the proposed new eatery, you will have to drive down a ramp to underground valet parking, exit the vehicle, give your car to the valet there, go up an elevator to the restaurant, wait in line or sit at a table, order your coffee, pay for it, add cream and sugar, walk back to the elevator, go down to the valet area, give the valet your ticket, wait for your car (which may be parked on the other side of the hotel, 10-15 minutes away, depending on staffing), pay the valet $10-20 for parking fee, wait for your car, then get back in the vehicle. By then, the coffee is dead cold, and you just spent $25-$30+ and 30 minutes of your time. So some people think this is “a cool idea,” or “convenient?” Not me. I’ll opt for Pierre’s, Renaud’s, or even Starbucks! Or my Keurig at home!

One of the great ironies of this project, and the 6th Fallacy I will mention, is that the number of NEW, LOW-PAYING JOBS CREATED by the new retail Mall, restaurant, and luxury apartments above, (jobs such as valet parking, waitresses, janitors, housekeepers, maintenance men, more shop girls, etc.) will definitely exceed the number of new “affordable housing studios” being built on the east side of the hotel!

By adding 30-50 more low-paid workers in the retail mall, the new restaurant, and apartment buildings, Caruso is actually WORSENING the affordable housing crunch in our region!! They are creating far more very low-income jobs than the new housing is even designed to accommodate!! So far from solving the affordable housing dilemma, as another MJ letter-writer suggested last week, they are actually aggravating an already congested traffic and roadway situation, burning more gasoline, causing more pollution!

The reality of this project is that the affordable employee housing is a smokescreen to squeeze more profit out of every square foot of their property. Caruso is willing to bring a commercial mall with more traffic, congestion, and multi-story buildings to a quiet neighborhood and to a hotel that used to be known for its cottage-style architecture and atmosphere. The proposed retail mall of 12 high-end shops, in addition to the 10 luxury shops already existing in or near the main building, is designed for outsiders, for wealthy guests that want “an L.A.-like Shopping Experience.”

If the housing was to be built on its own, with the appropriate genuine interest in serving employees – as a stand-alone – then it would be acceptable and welcome. But it is not. It is a bargaining chip.

So if one can see sense of these fallacies and incongruities, and run the figures, it makes no sense to claim that the new retail mall and apartments are simply “to help pay for the employee housing!” No, the plan for this project is purely to make hundreds of thousands of dollars more each month for Caruso Affiliates!

This is not about how the current operators of the Miramar resurrected the old buildings. It is not about what they had to go through to rebuild and reopen the hotel. It is not even about the hotel today, or the raft, or an Easter brunch, and what kind of job they do as a hotel now. It is about commercializing a new area in Montecito. We have designated areas here already for retail enterprises! All the coffee and Prada sunglasses in the world are nothing if we lose the charm and appeal of Montecito to outside commercial developers.

During the Vietnam War, a U.S. Army Major once said that “…we had to destroy the village in order to save it.” Let’s all hope that village in today’s case is not Montecito!

I urge you all to take a good look at this situation, and Reject this commercial addition as being unrealistic, disingenuous, and harmful to the character and living conditions of the broader neighborhoods near the hotel.

Cliff Ghersen
Neighbors of the Miramar

Suggestions for Miramar

Regarding the Miramar Hotel’s proposed expansion, I want to suggest that the regulatory bodies in Montecito and S.B. County consider dividing owner Rick Caruso’s ambitious plans into two separate subject areas and treat them separately. This is because the one – additional housing, is non-controversial, while the other – 12 stores built on a quiet street corner one block from the beach – could possibly transform a traditional seaside residential neighborhood into a locus of traffic congestion and noise.

Permit me to step back a bit. I’m a fan of Mr. Caruso’s philanthropy and shopping areas in Los Angeles. Along with several friends of mine, he raised tens of millions of dollars to construct the landmark modern Catholic cathedral, Our Lady of the Angels, by Pritzker Prize winning architect José Rafael Moneo Vallés. At USC, he built what is to me one of the most beautiful churches in America, the $29-million USC Caruso Catholic Center, with exquisite stained-glass windows by the renowned Judson Studios and an enormous wooden cross created by sculptor Christopher Slatoff, and Stations of the Cross painted by plein air artist Peter Adams. I love visiting there, one of the most serene, peaceful, and spiritual places in the giant, hectic city.

Like everyone else in L.A., I have enjoyed shopping at The Grove for decades and especially appreciate the decision to locate it next door to the historic Original Farmers Market. It’s a center of L.A. life. And that brings me to the vast difference between The Grove and what Mr. Caruso is proposing for the beachy Miramar residential neighborhood. His housing plan will fit right in, and it allows Montecito to get credit from the state of California for building affordable housing. But – and this speaks to Mr. Caruso’s recent comments at an economic forum about the need to revitalize State Street – why does he not consider moving his “upscale mini mall” concept to State Street, a commercial area vastly different from the quiet corner next door to the 124-year-old sanctuary of All Saints By the Sea Episcopal Church? Investing in an upscale shopping area with stores such as Zegna and other respected international designer brands in downtown Santa Barbara could be Mr. Caruso’s contribution to State Street’s revitalization.

Eileen White Read

To Gwyn Lurie:

As a weekly reader of the Montecito Journal, I always look forward to the prospect of a Gwyn Lurie editorial.

Your writing and insights are wonderful.

The recent “Lead or Get Out of the Way” bolsters that evaluation.

With much appreciation,

Bob Levine

Drawing Distinctions

Thanks, Gywn, for your always illuminating voice as you make sense of chaos! Your careful and insightful drawing of the distinction between protest and pogrom should be mandatory reading for the entire nation. It is so unfortunate that added to our homegrown prejudices, we are now dealing with immigrant prejudices and hatreds toward those from other countries as well. The Hatfields and the McCoys had nothing on this current crop of haters.

Regards,

Hattie Beresford

Thoughts to Share

Gwyn, I want to compliment you on your well-written, thoughtful and persuasive editorial; and to commend you for having the courage and integrity to speak up when many of my fellow liberals are hesitating to do so, for fear of being thought to be politically incorrect. (And I, like you, speak from a personal history of impassioned political protest.) I hope your editorial is shared with some of the student protestors. Thank you again.

Gail Stassinos