Category Archives: Jobs

Studio Purchase Is Good News for Jobs

Earlier this month, Hudson Pacific Properties, Inc. announced that it had finalized a $200-million acquisition of the historic Hollywood Center Studios. This is the third studio acquisition in Hollywood by Hudson Pacific. Based on their track record, it is very good news for Hollywood.

Hudson had previously acquired Sunset-Gower Studios and Sunset-Bronson Studios. They will now own a combined 1.2-million square feet of facilities at the three studios, including 35 soundstages on 41-acres. The acquisition makes Hudson Pacific the largest independent owner-operator of sound stages in the nation.

I first became acquainted with Hudson Pacific when they purchased Sunset-Gower Studios in 2007. They were in a competition against several other firms for the property. Theirs was the only proposal to keep Sunset-Gower as an independent studio. The other developers planned to replace the studio with housing.

While there certainly was the need for housing, I was very concerned about the potential loss of industrial space, especially since Hollywood only has about 200 acres zoned for industrial uses. It was a time when Hollywood’s future hung in the balance. Many entertainment-related firms had exited Hollywood in previous decades, including almost all of the television stations. We were very concerned that Hollywood might lose its historical role as a commercial center.

Fortunately, Hudson Pacific did get the property, and they followed up by investing in the infrastructure and revitalizing the studio. Technicolor moved into a new 115,000-sq.ft. building at Sunset-Gower, making it their North American headquarters. This was the first major entertainment firm to move into Hollywood in decades.

In 2008, Hudson Pacific acquired the Sunset-Bronson lot. At that lot, they have built 423,000-sq.ft. of office space, all leased to Netflix. Their projects, along with others completed by Kilroy Realty and J.H.Snyder, have helped reestablish Hollywood as a commercial center. With 2,800 housing units under construction and another 7,200 in the pipeline in Hollywood, these projects will help us to maintain an important jobs-housing balance.

So the announcement that Hudson Pacific has acquired the historic Hollywood Center Studios bodes well for Hollywood. Hudson, in making the announcement of the purchase, also stated that they plan to move forward with a new 100,000-sq.ft. creative office building and a 350-space parking garage at the lot, which will be renamed Sunset Las Palmas.

For those not familiar with this lot, it is one of the most historic and oldest operating studios in Hollywood. It was founded in 1919 by a partnership formed by C.E. Toberman, John Jasper and C.W. Bradford. At the time, C.E. Toberman, who was the “Mr. Hollywood” of his day, had plans to convert Hollywood Blvd. (which was a mishmash of residential, retail and industrial uses) into a grand street and wanted to remove all industrial uses from the boulevard. The creation of the lot, christened Hollywood Studios, Inc., helped accomplish that goal. Over the years, the studio became home to iconic television shows like I Love Lucy, The Addams Family, Jeopardy, and legendary films like Hell’s Angels, When Harry Met Sally, and The Player.

Hudson Pacific has been responsible for bringing hundreds (if not thousands) of jobs to Hollywood. They have played a major role in the revitalization of Hollywood. On June 22nd, they will be honored with our Excellence in Economic Development Award at the annual Hollywood Economic Development Summit. The honors are well-deserved. On behalf of the Chamber, let me say that we appreciate having such great partners as Hudson Pacific in our community.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Musings About a Target

By now, most people have heard the disappointing news that Superior Court Judge Richard L. Fruin, Jr. has once again sided with a very small group of plaintiffs to prevent Hollywood’s new Target from being completed. I thought it might be appropriate to offer of few of my own observations on this sad state of affairs.

Let me first offer a little background. It has now been nine years since Target first filed to build a store in Hollywood. When it was initially approved by the City and threatened with a lawsuit, Target decided to do a complete Environmental Impact Report (EIR) to strengthen its case against lawsuits. However, that later proved to be of little value.

At issue was a quirk in the Station Neighborhood Area Plan (SNAP) that governs development in that area. The SNAP ordinance allows projects that are strictly retail to only be 35 feet in height, but allows mixed-use projects to be up to 75 feet. The City Council and Planning Commission felt that the Target would be a benefit to the neighborhood and granted a variance to allow the project to be built at the 75-foot height.

The La Mirada Neighborhood Association, which is reputed to have only two or three members, sued. Judge Fruin ruled that the EIR was fine, but that the city erred in granting a variance and should have changed the zoning.

The City, in order to comply with the judge’s order, created a new Subarea F zoning category for big box retail centers. Once again, the La Mirada Neighborhood Association sued, saying that the City should have performed a new EIR to justify the new zoning designation. And once again, the judge agreed with the plaintiffs. It serves no purpose to rebut the judge’s rationale for his decision, but I would like to share my thoughts on what a loss it means for Hollywood.

Between 250 and 300 permanent jobs have been lost to the community now for several years because of these lawsuits. These are jobs that could have been filled by many of the low-income residents in the neighborhood close to the Target site. In addition, the Target would have provided expanded shopping opportunities for our entire Hollywood community, and would have been within walking distance for many low-income neighborhoods. It is only two blocks from the Hollywood/Western subway station and so is easily reachable from all areas of Hollywood. We haven’t had a department store since Sears closed its Hollywood store in 2008, so this would have been a wonderful addition to the community.

I get more questions about the status of the Target from both residents and businesses than any other subject. There is overwhelming support in Hollywood for this store. So the question is “What are the specific reasons why these few people are opposing the Target so vehemently?”

Robert Silverstein, the plaintiff’s attorney, usually responds that the plaintiffs aren’t against a Target – they just want them to follow the city’s rules. My objection to that answer is that rules set by a city are not cast in stone. Historically, cities have always had broad discretionary powers to determine land use within their bounds. The SNAP ordinance is not the U.S. Constitution. The City should have the right to make changes as circumstances warrant.

We live in an urban area. What value is achieved by limiting a retail center to one story? When we have attended past hearings on the Target, the main justification of the opponents for their position is that they want housing built in the neighborhood, not just retail centers. If developers wants added height, they have to provide housing as well, they say. They also have voiced concerns over views being blocked or a building built out-of-scale with the neighborhood.

I could understand these arguments eight years ago, but circumstances have changed dramatically since that time and the rationale for those positions no longer applies. In the interim, three projects have been announced and are in the entitlement phase across the street from the Target that will provide 1,293 housing units. These projects will all be as high, or higher, than the Target. So what purpose is to be achieved by forcing the Target to be torn down and rebuilt at one story? My answer would be “Absolutely none.”

The opponents can bask in their latest court victory, but in my view, they should be asking themselves if they are really serving the greater good for Hollywood? If Target pulls out because they are tired of fighting this small group of naysayers, have the interests of Hollywood really been served? Does the loss of these needed jobs and shopping opportunities mean anything to the opponents?

Being with the Chamber of Commerce, I am an eternal optimist. We have been through some difficult times in Hollywood, and despite setbacks, the community’s revitalization continues to move forward. I remain hopeful that a solution can be found so that the Target can be completed. Meanwhile, I would urge everyone who is supportive of having the Target finished, to not be silent. Let the La Mirada Neighborhood Association know how you feel.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

A Post Mortem on Measure S

In the aftermath of Measure S, it seems everyone is offering their post mortem observations about this giant struggle over land-use and development in Los Angeles. I’d like to add my “two cents”.

First, the voters made the right choice in sinking Measure S.  We can breathe a sigh of relief that a blanket moratorium did not go into effect that would have vaporized thousands of construction jobs and wreaked havoc on our economy. Now we can continue to address the serious shortfall in housing in our region.

Second, although the voters rejected Measure S, it was not a vote of support for the status quo. Far from it. Both residents and businesses made it clear that the current system is broken and needs to be fixed.

Third, the Mayor and City Council need to follow through on the reforms that were promised, among which were to update community plans in a timely fashion and to have the Planning Department select the consultants performing environmental impact reports.

Fourth, once community plans are updated, “spot zoning” (changing land-use rules to accommodate specific projects) should become the exception rather than the rule in approving projects. It would be helpful if criteria could be drawn up that explains when it is appropriate to grant an exception.

Fifth, greater transparency should occur throughout the entire process, so that trust can be established with the public. One particular area that needs improvement is with community benefits packages. The Planning Department and councilmembers now negotiate these packages, sometimes extracting millions of dollars from developers for projects that will benefit L.A. This process needs to be revised so that the public has more of an opportunity to provide suggestions on things that would benefit the impacted neighborhoods. And once a package is finalized and the developer hands over to the City mitigation funds, there needs to be accountability so that the public knows to which department the funds went and that they were spent according to the plan.

An example may help. When the Hollywood & Highland complex was built back in 1988, the City negotiated a contribution from the developer for more than $9-million to be spent on traffic improvements, etc. Years afterward, when I tried to find out if the money had been spent, I could get no answer. Yet, more than 10 years after the project was completed, I saw a motion before the City Council approving the expenditure of some of the mitigation money from that project. I am not implying that anything was done incorrectly. What I am saying is that the system was not set up for transparency with the public.

With today’s technology, there is no reason that a tracking system cannot be set up on a City website that easily allows the public to see what the community benefits packages are for each project and to track the expenditures of those funds as they occur. This is an issue of trust. If the public can see that these funds are truly going to benefit them and are actually being spent on the purposes intended, it will help to instill trust in the system.

Finally, in my conversations with neighborhood councils, one of their largest concerns is with evictions that are taking place to make way for some new projects. Most of these evictions are occurring with rent-controlled buildings and by-right projects. With the affordable housing crisis, some tenants are losing their homes with no place to go. The city needs to review its current policy to strike a balance between property rights and fairness for those being evicted. It is a complicated issue with no easy answers because of conflicting state and local laws, but the conversation needs to occur.

The voters have indicated by large margins in the last two elections that they understand the need to “densify” our City rather than to continue expanding outward. That is the proper course of action, but it is not easy to achieve. The Hollywood Community Plan update will be coming back later this year for reconsideration. Stakeholders will have ample opportunity for public input into the process. With all of the development and changes occurring in Hollywood, we really need to have an updated plan rather than operating under one that dates back to 1988. Let’s have the discussion necessary to adopt a plan that will move this community forward and which will help to reestablish trust in our land-use process.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

 

Keep the Momentum Going in 2017

As we begin 2017, I am optimistic about our future prospects in Los Angeles and Hollywood. When it comes to jobs, Los Angeles County has been moving in the right direction. In 2016, employment grew by 65,300 jobs and the unemployment rate declined to 5.1 percent.

Here in Hollywood, the news on the jobs front is also positive. Viacom has begun moving into its new home in Columbia Square and Netflix will be moving into the new Icon tower at Sunset-Bronson Studios within the next month. Netflix announced a week ago that they will take an additional 92,000-sq.ft. of office space at their new Hollywood home, bringing their total to more than 400,000-sq.ft. on that campus. Between these two companies, another 1,500 jobs will be added to the Hollywood market. These are good jobs that will provide opportunities for Hollywood residents and ancillary businesses.

Other positive prospects in Hollywood at the beginning of the year include the opening soon of two hotels – the Dream Hotel (which includes several restaurants) on Selma Avenue, and the Hampton Inn on Vine Street. Between them, about 300 hotel rooms will be added to the market and they will provide hundreds of jobs.

Later this year, we should see the completion of J.H. Snyder’s 1601 Vine Street office building and the Kimpton Hotel. There may also be a few additional ground breakings this year – provided Angelinos do not approve the ill-advised Measure S.

For the past year, we have debated this initiative that would place a two-year moratorium on significant building within Los Angeles – singlehandedly killing jobs, housing and reasonable growth in our city. The vote on this measure is coming up on March 7th.

Proponents say their measure will force the City to update community plans and to outlaw “spot zoning” and that it should only last two years. In actuality, it is much more complicated than that. Among the proponents are some of the people who sued to invalidate the Hollywood Community Plan Update in 2012.  Thanks to their efforts, the community is forced to operate under an antiquated plan that was adopted in 1988. What are the chances that any new community plan approved by the city will go into effect without a lawsuit challenging it?  In reality, the moratorium called for by Measure S could last for years under such a scenario.

L.A. city and county residents this past November overwhelmingly voted for reasonable growth. They passed Measure M, which will generate $860-million a year to accelerate the construction of a working mass transit system for this region. L.A. city voters also passed Measure HHH, a $1.2-billion bond to build housing for the homeless.

The passage of Measure S could put the brakes on plans to add density around mass transit stations and it could also make it very difficult to build housing not only for the homeless, but housing for anyone in Los Angeles. It would also apply to needed public improvements such as expansion of hospitals, etc.

I am indeed an optimist, and believe that voters will reject a measure that makes it difficult to implement the objectives that they just approved in November. However, it behooves all of us to do our part in educating our friends and neighbors about the negative ramifications of Measure S and to get out the vote!

L.A. is moving in the right direction on jobs. We need to continue that momentum. With the defeat of Measure S, I am convinced this will be another positive year for L.A. on the jobs front. Let’s make it happen.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

What is the Value of a Job – Close to Home?

The California Legislative Analyst’s Office (LAO) released a study in September (California’s First Film Tax Credit Program) that for the first time, offers an assessment of the economic and fiscal impact of the filming incentives that the State of California approved for our entertainment industry. This is particularly interesting because the LAO is the nonpartisan fiscal and policy advisor to the state legislature, which means we should be able to rely on the veracity of their report.

The study zeroes in on the tax incentives that were first adopted in 2009 which provided a total of $800-million in incentives spread over eight years at $100-million per year. The LAO did not evaluate the more recent incentives (AB1839) that were passed in 2014 and raised the subsidy to $330-million a year. That report will come in a couple of years. Why should we care about what the LOA says? Because when it comes time to renew the film incentives, the LOA’s report will likely carry a lot of weight with legislators!

Unless you are a policy wonk, you are unlikely to wade through this report, so let me share with you some of the most interesting data in the report.

The LOA estimated that the $800-million in tax credits went to productions that will spend an estimated $6.1-billion in California over the life of the first film tax program. They estimate that the “economic output of California was increased by between $6-billion and $10-billion on net over a period of more than a decade.” I wonder how many other investments by the state of California have resulted in numbers like this? That is money that went to buying goods and services and payroll for thousands of Californians.

What is particularly interesting is how much this new spending generated in tax dollars for state and local jurisdictions that would otherwise not have happened. The LAO estimates that the increase to State General Fund revenues amounted to between $300 and $500-million (not adjusted for inflation) and that the bulk of this increased revenue came in the form of state personal income taxes. Not only that, but they estimate that local tax revenues increased by roughly $200-million over the life of the program.

So, to summarize, the LAO is saying that on the low end State and local jurisdictions received $500-million in new taxes and on the high-end as much as $700-million in new revenues on an investment by the State of $800-million. This means that the net cost to the State was between $100 and $300-million. We haven’t yet seen any studies that estimate how many jobs have been saved, but conservatively it numbers in the thousands. These are the jobs of Californians, who previously were forced to leave the State to find work.

Paul Audley, the President of FilmL.A., Inc., tells me that prior to the passage of the 2009 tax credit, the L.A. region was losing key productions at an alarming rate. The worst quarter on record occurred immediately prior to the implementation of the tax credit. He added that with the enactment of AB1839 in 2014, California has regained ground and stabilized the vendor and crew base, and that currently, 25 percent of TV production and 10-percent of feature film production in L.A. is due to the tax credit program.

The LAO generally advises policy makers against tax expenditure programs, but in this case said that it was “understandable to defend a flagship industry targeted by other states” and that the credits “can be viewed as ways to ‘level the playing field’ to counter financial incentives to locate productions outside of California.”

If the State had not offered the incentives, it was on the way to losing its signature industry. Was this a good investment by the State? I think most Californians would say “absolutely.” Where else could the legislature have invested $800-million in economic development and seen income tax revenues coming back to the State of as much as $500-million with an economic stimulus as high as $10-billion?

But behind the numbers is a more important fact. California families were being separated for long periods of time since so many were forced to follow productions out of state if they wanted to work. We have heard from hundreds of people who are grateful to our public officials for enacting this program that has allowed them to return home to work. And that is a number to which you cannot attach a price tag.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Master Plan Is Of Paramount Importance

Last week, the City held a public hearing on the proposed 25-year Master Plan for Paramount Pictures. This storied studio, which dates back to 1912, is the last remaining major studio located in Hollywood proper. Warner Bros., Columbia, Fox and Disney got their start here, but all moved out many decades ago. As hearings go, this one was cordial. Even those who had issues were on their best behavior. Everyone understands how important Paramount is to our community.

As Chamber President & CEO, I pointed out how critical Paramount is from a jobs standpoint. With 5,000 people employed on the lot on an average day, Paramount is our jobs anchor in South Hollywood. That is important to our economy because there are numerous ancillary jobs nearby that depend on Paramount – whether a restaurant or prop house or catering truck.

These are by and large middle income jobs. And that is important in Los Angeles – which is the most expensive city in the nation on an income to housing costs basis. It costs a lot to live here. With sharp declines in the aerospace and manufacturing sectors since the 1990s, it is vital that we grow our homegrown entertainment industry.

When you consider that there are only about 200 acres in all of Hollywood that are industrially zoned, it means that we must maximize the jobs on the industrial land that we do have. And Paramount occupies 56 acres, plus an adjacent six acres used primarily for parking. That is more than a quarter of our entire industrially-zoned land.

In order for Paramount to survive in the very competitive entertainment sector, it must be able to expand to take advantage of opportunities as they arise. It was pointed out at the hearing that Paramount is the last of the major studios to update its master plan. That provides them with the perspective to see what their competitors are doing.

It also clearly delineates why they need to plan for technologically advanced sound stages with adjacent production offices, new climate control and lighting systems. It explains why they will need high-tech post production facilities, and adequate parking. It demonstrates why upgraded employee amenities are planned. It is all about competition.

Over the next 25 years, under the proposed plan, Paramount will invest $700-million with a $1.1-billion economic output during construction, which will generate 7,300 construction jobs. However, for me the more important figure is the number of permanent jobs that will be accommodated on the lot once the plan is fully implemented – 12,600 jobs with $3.1-billion in annual economic output. Those are jobs that will enable employees to truly have a “living wage”. Those are jobs that many of our children will occupy.

A year ago, the State of California approved AB1839, which vastly increased funding to compete for entertainment jobs, and to bring them back from other states, due to their film tax credit program. In the subsequent year, we have seen just how successful the program has been. We now have a chance to grow this industry once more – and we must, if we are to demonstrate to the State that their investment was worthwhile.

What I heard at the hearing were typical concerns – traffic, the height of some buildings, making parking structures attractive, the preservation of historic resources, signage. These are issues that I’m sure will be addressed by Paramount as it moves forward with its plan. I did not hear any issues that were insurmountable. We encourage the City to approve a reasonable plan for Paramount and for our community. We all have a stake in Paramount’s future.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood

A New House Is Coming to Hollywood

Recently I attended a gala press announcement hosted by the Japanese Consulate and Consul General Harry H. Horinouchi. I was particularly interested to learn about a cutting-edge initiative that is going to be very beneficial to Hollywood, and which is bound to become a new attraction for both locals and tourists.

Known as Japan House, the program is a new public diplomacy initiative from Japan’s Ministry of Foreign Affairs to showcase the best of Japanese arts, culture, innovative technology, food, and more. The Ministry has selected three locations around the world to showcase the initiative – London, Sao Paulo and Los Angeles. Of particular interest to us is that Hollywood & Highland has been selected as the Los Angeles location.

The Los Angeles Japan House will bring the most authentic aspects of Japan to the world and will promote understanding and appreciation of Japan in the hopes of strengthening U.S.-Japanese relations. The concept is still being refined, but you can expect Japan House to open within 2017. You should also know that our own Beth Marlis, Chamber Chair of the Board, is on the advisory board to the Japanese consulate, working to make this a reality.

There are a few things that we already know about Japan House. It will consist of two separate locations at Hollywood & Highland. On the second floor, the facility will take up over 6,000-sq.ft., with a shop, café, multi-media room (and special presentations about Japanese culture), and a seminar room. On the fifth floor, there will be a Japanese restaurant featuring top Japanese chefs and an event space (in over 8,000-sq.ft.) which can accommodate 200 people.

This is exactly the type of attraction that Hollywood needs and can host better than any place else in Southern California. We already know that Hollywood is a magnet for people from the entire region. Enterprises such as the El Capitan Theatre, the Pantages Theatre, the Hollywood Bowl and Amoeba Records have proven that this is the place for entertainment. We are the top tourist destination in Los Angeles County as well – and with the pending opening of Universal Studio’s Wizarding World of Harry Potter – we expect that our desirability will continue to grow.

I believe that unique attractions such as Japan House have their greatest chance at success here. And they help our “brand” as well. For Hollywood to succeed, we must be able to continue to add new attractions that will draw people. We cannot sit back while other areas of Southern California open popular new venues.

Tourism, along with Entertainment and Health Care, are our three major employment sectors in this community. Thousands of jobs rest on our ability to continue to improve the Hollywood brand. The Hollywood Walk of Fame is one way that we constantly reinforce the brand, but we cannot rely just on the tried-and-true attractions.

We welcome Japan House to Hollywood and look forward to having their involvement in this community. As we learn more details about their plans, I am sure that the level of excitement will grow even more!

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 24 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood

City Sets Priority to Create Jobs

Last week, the first meeting was held of the L.A. City Council’s new Ad Hoc On Comprehensive Job Creation Plan Committee. I attended and offered our Chamber’s strong support for their efforts. It is extremely critical to the future of our City that the City Council act to jumpstart the creation of jobs.

Committee Chair Paul Krekorian said “This is going to be a committee that takes action and makes recommendations to the Council. This is the biggest priority we have as a city. It will impact our ability to maintain a high quality of life for our residents.”

Dr. Christine Cooper from the L.A. Economic Development Corporation presented an overview of the opportunities and challenges that we face. She noted that L.A. unemployment has consistently been higher than at the county, state and national levels.

She wasn’t exaggerating. Since 1990, jobs in the U.S. have increased by 29 percent and by 28 percent in California. In Los Angeles, by contrast, the number of payroll jobs has increased only by 2 percent during the same period, according to the UCLA Anderson Forecast.

So the Ad Hoc Committee has a challenging assignment. We hope they will move quickly. Already, they have passed a motion directing various City agencies to report back with recommendations on a comprehensive job creation plan.

I’m sure there will be ample opportunity for input from the public as well. Let me offer a few suggestions. First, the City cannot create a jobs strategy without addressing the biggest drag on jobs creation in the City – the job-killing Los Angeles Gross Receipts tax. This is the highest business tax in the county by a factor of 9.5 times the average of the other 87 Los Angeles County cities.

The City has made small efforts to trim back the tax, but much more is needed. Over the next three years, the tax will be reduced by 5 percent a year. Assuming the City Council approves continuing reductions at that rate, it would take 20 years to do away with that tax – not enough to jumpstart jobs creation.

It is a challenge for the City Council to eliminate this tax, because it generates some 10 percent of City receipts. Facing an ongoing structural deficit, it takes a leap of faith to do away with it altogether and the City Council has been reluctant to do so. But maybe there are other alternatives that could be considered – such as reducing it initially to the countywide average for all cities so that we are not placed at a competitive disadvantage? Perhaps, the City could study alternative taxes that wouldn’t have the same negative impact on jobs creation? If the City wishes to be a competitive player in jobs creation, then it has to be a competitive player when it comes to the cost of doing business – and taxes are a big consideration for many firms.

The City should also look at where jobs are being created and see how they could facilitate that growth. Currently, Hollywood and Playa Vista are the biggest job creation engines within the City. With more than one-million sq.ft. of office construction underway, Hollywood has the potential to create thousands of new jobs. Already, Viacom, Netflix, Neuehouse, SIM Digital and others have announced they are coming to Hollywood. Other projects are in the pipeline and could be expedited if the City put the Hollywood Community Plan on the fast track to being reconsidered and implemented.

There are many other things that could be done, such as structuring an incentive package to encourage hotels to be built in all areas of the city – not just downtown by the Convention Center (which is the practical result of a plan that was presented earlier this year). The City could streamline the process that business owners and start-ups have to go through to get permits to expand or to open a business.

If you have ideas on what the City could do, send them my way and we will pass them on to the City. Better yet, plan to attend the ad hoc committee’s hearings! We will post them on our website as soon as we are aware that they have been scheduled. This may be a unique opportunity to move our city forward. Let’s all work to help the City craft a package that will really make a difference.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 23 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Millennials Setting the Pace for Hollywood’s Future

At our recent Hollywood Economic Development Summit, keynote speaker Victor Coleman of Hudson Pacific Properties, shared some fascinating statistics.

He said that 35 percent of Hollywood’s population (zip codes 90028 and 90038) is made up of Millennials (those in the 18 to 35 years old bracket). That is the largest concentration of Millennials of any community within Los Angeles County. It is greater than West L.A., which contains 29 percent Millennials and Santa Monica, which comes in with 24 percent Millennials.

When you look at a three-mile radius of Hollywood, the percentages remain strong, with 29 percent of the population composed of Millennials, greater than any other comparable zone except Downtown.

Why is this important to the future of Hollywood? Because this is a key reason why creative companies are interested in locating in Hollywood. We have the right demographic they are seeking. We want to attract firms that will employ these young people so that they do not need to travel elsewhere to work.

Hollywood is at the forefront of developing a new paradigm in Southern California – a place where people really can live and work in close proximity without the need for a car. We have got to stop pushing development to the periphery of the metropolitan area, requiring people to drive wherever they need to go and in turn clog our freeways and streets.

Over the past couple of years, new development in Hollywood has faced opposition from residents, primarily in the Hollywood Hills, who have objected to the growth in central Hollywood. As is usually the case in Southern California, those concerns are primarily focused on traffic and congestion. People just don’t believe that it is possible to change commuters’ habits.

With the Millennials, we finally have a chance to change that mindset. Studies have shown that they are urban centric. They like to walk, bike and take public transit. They are fascinated with Uber or Lyft and other alternatives to having their own vehicles. And they crave 24/7 walkable, mixed-use neighborhoods with a cool, hip factor.

Let me share with you a few statistics that bear this out. One study by Atlantic Cities revealed that up to 86 percent of Millennials said it was important for their city to offer opportunities to live and work without relying on a car. Nearly half of those who owned a car said they would consider giving it up if they could count on public transportation options.

A study by U.S. PIRG showed that Millennials drove on average 23 percent fewer miles in 2009 than they did in 2001 – a greater decline in driving than any other age group. During the same time period, Millennials who lived in households with annual incomes of over $70,000 increased their use of public transit by 100 percent, biking by 122 percent and walking by 37 percent.

These statistics bear out why central Hollywood is so attractive to Millennials. It is a very compact community. You really can walk almost everywhere you need to. There are plenty of entertainment options – and more are coming. As the area fills in with more desirable retail stores, it is easy to see this area becoming one of the most walkable communities within Southern California. We are on the Redline Subway route, the backbone of the Metro transit system. As more lines are added, it will become even easier for residents of Hollywood to get where they want to without a vehicle.

So Hollywood is a prototype of what we need to encourage in Southern California. I would invite the skeptics who believe that this can’t work here to watch what is happening in Hollywood. We must accommodate growth within the Metro area, but we must do it with more forethought. This is the smart way to grow.

Obviously, there are other steps that can also be taken to improve traffic circulation – such as seeing that mitigation funds from new projects are invested wisely in street improvements and taking advantage of programs such as the Mayor’s Great Streets initiative. However, our new millennial generation presents a unique opportunity for Hollywood.

As a business community, we need to foster and welcome these young professionals to Hollywood. The Chamber has already created our Hollywood Young Professionals and Entrepreneurs program (HYPE). It is amazing to see the energy within this group.

I am sure that there is a lot more that we can do. We should all be having conversations with these new Hollywood residents and ask what their needs are and what would make Hollywood a better neighborhood for them. I suspect making it cleaner and safer would be at the top of their list. We have a lot of work to do, but having this key demographic in our community gives us an amazing opportunity to continue the revitalization of Hollywood.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 23 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

A Jobs Strategy for L.A.?

With all of the recent attention by the City on raising the minimum wage, very little of the rhetoric was devoted to the real need in Los Angeles … to increase the number of middle-class jobs. People need to have an opportunity to move up the jobs ladder in order to truly improve their quality of life. A minimum wage increase does not accomplish that.

So how is Los Angeles doing on the jobs front? The UCLA Anderson Forecast released their latest report in early June. The report revealed that the L.A. metro area has seen brisk growth of 2.5 percent in each of the past two years, which finally allowed L.A.’s employment to surpass its pre-Great Recession level of more than seven years ago.

However, William Yu, an economist with the Anderson Forecast, pointed out that even with that growth, L.A. only increased its payroll jobs by 2 percent between 1990 and 2015. By contrast, the U.S. increased payroll jobs by 29 percent during that period and California created 28 percent more jobs. And other areas of Los Angeles County also increased their employment at a substantially higher rate than L.A. City. Yu called L.A. an “economic basket case”, lagging far behind the national norm. He noted that the only other major cities in the nation with similar weak job-creation records are Detroit and Cleveland.

The California Center for Jobs & the Economy, in May issued a report entitled “Economic Tale of Two Regions: Los Angeles vs. Bay Area”, where they stated, “Los Angeles presents a trend largely of jobs stagnation under which middle class wage jobs have been steadily replaced by lower wage service jobs.”

So, I would ask the question, “Besides raising the minimum wage, what exactly is the jobs strategy for Los Angeles?”

The Hollywood Chamber of Commerce Board of Directors met in June with Deputy Mayor for Economic Development Kelli Bernard, who detailed some of the Mayor’s jobs-related achievements. To be sure, Mayor Garcetti deserves credit for some of the growth of the past two years. He fought hard to get AB1839 adopted, which ramps up film tax credits to bring production jobs back to California and Los Angeles. We expect to see a positive jobs impact from that. He was also successful in luring Yahoo from Santa Monica to Playa Vista. And the Mayor has identified some sectors with job creation potential and set some goals such as creating 20,000 green jobs by mid-2017.

These are all great steps, but they do not answer the question of why there is no overall jobs strategy to put Los Angeles on a long-term road to matching the growth of other major metropolitan regions, the State and nation. If the City really wants to get serious about our poor jobs record, then there needs to be a comprehensive plan.

This week, in what is a step in the right direction, Council President Herb Wesson announced that he is creating an ad hoc committee on a comprehensive jobs plan. I applaud the Council President on taking this action. Let’s hope the committee takes a serious look at exactly why jobs are not being created in this City at the same pace as elsewhere. There is a lot of information for them to review.

Mr. Yu gave his assessment of what is holding Los Angeles back – a less friendly environment for business, low human capital (meaning a poorly educated workforce) and the high cost of living.

In reviewing his findings, I would point out that San Francisco has a much higher cost of living and is still creating jobs. We do indeed need to improve our educational system, but there are other cities with similar challenges that are creating jobs. I believe that the major factor holding L.A. back is its reputation as a less than friendly place in which to operate a business.

There is a feeling in the business community that we are constantly “under siege” in this City. Last year, it was the huge jump in the minimum wage for hotels with over 150 rooms. This year, the City approved an across-the-board minimum wage hike over the next five years to $15 an hour. We had to fight to get concessions for small businesses faced with a 67 percent increase in minimum wages. After our lobbying, the City Council offered a “token” concession of one extra year for only the smallest businesses with under 25 employees. Now the City Council is considering an ordinance to allow street vendors to compete with brick-and-mortar businesses and to require businesses to offer more sick leave. Where does it end?

Perhaps the elephant in the room when it comes to L.A.’s lack of job competitiveness is the onerous Gross Receipts Tax. Los Angeles has the highest business tax by a factor of 9.5 times the average for the other 87 cities in the County. The only way we can compete is when the City does a “carve-out” for certain sectors that the Council wants to attract here, such as they did last year for internet businesses.

Stories are numerous of businesses that have fled Los Angeles to escape from this job-killing tax. Here in Hollywood, we are still hurting from the loss of Legal Zoom, which moved to nearby Glendale with more than 300 middle-class jobs, when the City’s Finance Department decided to raise them to the highest tax rate imposed by the Gross Receipts tax.

There have been numerous calls to do away with this tax, including by Mayor Garcetti. Last year, the City Council did make a small concession by voting to reduce the tax by 5 percent in each of the next three years. To be perfectly honest, from a job-creation standpoint, that was not enough to move the needle one iota.

If the City Council is serious about creating jobs, they need to at least reduce this tax to the countywide average. Imagine what would happen if L.A.’s business tax were not 9.5 times higher than the County average? We might then be able to compete for new jobs. Give businesses some hope and they just might decide to expand here and hire more employees.

That would be the foundation of a jobs creation strategy. L.A. is the second largest city in the nation. We have numerous natural advantages. The business sector knows that we can compete if we have a level playing field. We can provide the middle-class jobs that this economy needs if the City acts decisively. We should not be in the cellar with Detroit and Cleveland. Hopefully, the ad hoc committee will come up with some realistic recommendations that the City Council will adopt.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 23 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.