The 2028 Olympics figure prominently in a battle over a proposed wage hike for workers at large hotels in Los Angeles.
Members of the Los Angeles City Council are currently considering an ordinance which would raise the minimum wage for workers large hotels and LAX gradually starting in early 2025 through Summer 2028, shortly before the scheduled start of the games. While that news was welcomed by the unions representing approximately 23,000 hotel and airport workers, industry groups have had a decidedly different response.
A letter sent to Olympic organizers by the Hotel Association of Los Angeles warns that many of its signatory hotels would invoke the force majeure provisions of its room block contracts for the LA28 games, arguing that participating is no longer financially feasible. The ordinance would raise hike the minimum hourly wage for hotel workers from $20.23 to $25 as early as February 1, 2025, and then continue increasing until reaching $30 per hour in July 2028. Combined with the increased cost of health insurance, the association contends this will amount to a 100 percent increase in wage and benefit costs.
Letters sent by management for several hotels echo these sentiments, with some ownership groups potentially opting to close altogether, cut jobs, or cancel proposed expansions. Lightstone Group, which recently developed an AC and Moxy Hotel tower near the Convention Center in Downtown Los Angeles, has stated that the ordinance could force the company to reconsider its pursuit of the stalled Oceanwide Plaza development in Downtown Los Angeles, which was at one point expected to include a 184-room Park Hyatt hotel.
The proposed ordinance, which is to be considered by the Council in the weeks, is supported by a September report conducted by Berkeley Economic Advising and Research, which concluded that a wage increase would be a boon to the local economy. While it concluded that tourists would absorb most of the cost increases, it did not include revenue or occupancy data from the Hotel Association, which was submitted after its completion. However, a subsequent report from the Chief Legislative Analyst dated October 23, 2024 states that the information it received only includes revenue and occupancy figures for "an unspecified subset of hotels," and that requests for additional data have gone unanswered.
Here's what we're reading this week:
Could L.A.’s rezoning plan to boost housing supply cause more tenant displacement? "...in an effort to build more housing to alleviate the affordability crisis, the city is proposing to supercharge those incentive programs in a way that could result in such projects making even more financial sense to undertake....Officials are proposing to do so on land already zoned for multifamily housing, where people tend to be renters, not in neighborhoods zoned for single-family houses where people tend to own." (LA Times)
Downtown Metro B/D Line Subway Service Suspended This Weekend For Electrical Work "Metro is temporarily closing DTLA B/D Line stations and SGV A Line stations - all to get ready for new extensions opening soon" (Streetsblog LA)
Design of pedestrian improvements at Chinatown/State Park StationLA ART
State officials asked LA residents for input on the Dodger Stadium gondola. Here are some burning questions "Any and all feedback received by Dec. 15 will be considered as the process moves forward." (LAist)
‘Why us?’: Housing nonprofits are paying millions in ‘mansion tax’ "In the last year, a pair of nonprofits coughed up a combined $6.1 million in mansion tax fees. Their leaders say the tax has hampered their ability to accomplish one of Measure ULA’s primary goals: provide affordable housing." (LA Times)
Van Nuys light rail project to become the first in San Fernando Valley since 1952 "Preliminary work on utilities for the voter-approved, $3.57 billion project has already begun. Heavy construction is slated to begin in spring 2025. Metro said they are aware that business owners and neighbors may be concerned about the impact on the area while the rail line is being built." (CBS)
Rendering of Victory Station on East San Fernando Valley light rail lineMetro
Unproven Tunnel Idea Getting in the Way of Inland Empire Transit Solutions "San Bernardino County Transportation Authority is still considering a car tunnel instead of high-capacity transit serving the Ontario Airport and its planned expansions." (Streetsblog California)
‘It’s a tremendous opportunity.’ Developers see gold in closure of Phillips 66 oil refinery in South Bay "The Carson site may lend itself best to warehouses, which are always in demand around the nearby Port of Los Angeles, the busiest container port in the Western Hemisphere, Gundersheim said. The facilities may be used by importers collecting goods from China before distributing them across the West Coast or by e-commerce companies such as Amazon to store and quickly distribute goods to customers in the South Bay....The Wilmington refinery site, which is connected to Carson’s plant by a pipeline, may lend itself to housing. It is bordered by golf courses, Los Angeles Harbor College, federally owned land and residential neighborhoods." (LA Times)
Rendering of the VA campusWest LA Veterans Collective
Appeals court puts a pause on plans to quickly build housing on VA campus in West LA "On Friday, the Ninth Circuit Court of Appeals granted the VA’s request for a temporary stay, for the moment pausing Carter’s order to fast-track new housing and giving VA officials relief from possibly being held in contempt of court. Lawyers for the federal government have argued the VA’s $407 billion annual budget is already tied up serving competing needs." (LAist)
John Mayer, McG to Buy Jim Henson Lot in Hollywood "The 80,000-SF lot on La Brea Avenue was originally founded by Charlie Chaplin"(Commercial Observer)
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