Wanda Group has negotiated a tentative — and quite sizable — development agreement with the city of Beverly Hills for its $1.2 billion development at 9900 Wilshire Boulevard.
As part of the agreement, announced Friday, Wanda would pay the city upfront fees of $60 million — instead of $30 million — if City Council approves its One Beverly Hills project. Wanda also agreed to quadrupled Environmental Mitigation and Sustainability fees, as well as an additional 5 percent surcharge of gross room revenue that wasn’t part of the initial agreement.
Beverly Hills Mayor John Mirisch said the deal might be the most lucrative development agreement the city has ever signed. The deal was negotiated by a City Council ad hoc committee of Mayor Mirisch and Council member Lili Bosse with assistance from the law firm Greenberg Glusker.
The law firm had never seen “a deal with these kinds of benefits in their broad experience,” Mayor Mirisch told The Real Deal.
A representative of developer Beny Alagem, who is asking voters to approve a condo project next door to One Beverly Hills by way of ballot Measure HH, quickly responded to the announcement, calling it suspicious that such a deal was negotiated ahead of City Council review.
“It is completely premature and highly unusual for the City and Wanda to jointly announce and publicize a Development Agreement making it seem that the Wanda project is a done deal when it hasn’t even been reviewed or approved by City Council,” Hilton spokesperson Marie Garvey told the Beverly Hills Courier Friday.
Therese Kosterman, a spokesperson for the city of Beverly Hills, countered that such agreements are customary before a development gains approval.
The Development Agreement Statute allows developers, through contracts with cities and counties, to set rules, regulations and policies during the planning stages of a project. Such agreements contract the developer to provide benefits to the city, such as infrastructure improvements, public open space, or, in the case of Wanda Group, monetary payment.
City Council will begin meetings on One Beverly Hills on November 7.