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Developer Responds to Union Demonstration at Santa Monica City Hall

Santa Monica Real Estate Company, Roque and Mark


Rusty's Surf

Harding Larmore Kutcher & Kozal, LLP  law firm
Harding, Larmore Kutcher & Kozal, LLP

By Jason Islas
Staff Writer

September 5, 2013 -- OTO Development, the company with two pending hotel projects in Downtown Santa Monica, said Wednesday its projects would be labor friendly and offer a living wage.

The statement by Mike Gallen, director of development for South Carolina-based company, comes five days after a group of two dozen members of Unite Here Local 11 -- the regional hotel workers' union -- took to City Hall with a petition calling for the promise of higher wages at OTO's two six-story hotels proposed for the corner of Fifth Street and Colorado Avenue. ("Union Marches on City Hall for Higher Wages in New Santa Monica Hotels," September 3)

“(W)e have agreed in private communications with the Union, and publicly at our most recent Planning Commission Hearing, to pay a fair Living Wage, as ultimately determined by the Santa Monica City Council,” Gallen said.

The projects' proposed development agreements (DAs) would commit the owners to paying $12.85 an hour as a minimum wage, but Unite Here has demanded that OTO go higher to $15 an hour.

“We have also agreed to execute Neutrality/ Card Check Agreements with Unite Here Local 11, essentially guaranteeing that these will be Union hotels,” said Gallen. “We have also agreed to local hiring policies and have agreed to contribute to their hospitality training academy.”

Unite Here representatives are not satisfied, however. Rachel Torres, a research analyst with the union, offered only a one sentence response to Gallen's statement.

"As OTO Development knows, they will not agree to the standard that all of the other union hotels in the City of Santa Monica follow," she said. Torres did not elaborate on the specifics of that standard.

At the July 25 Planning Commission meeting, Gallen said that Unite Here was asking OTO to commit to a labor neutrality agreement – a legal prerequisite that clears the way for workers to unionize -- at all future hotels the company would build in the county.

Torres refrained from commenting about the matter when asked about it by Commissioners, saying that the negotiations were private.

The Commission did ask for deeper commitments from OTO for the two hotels, including more money for the City's $10.7million Esplanade project, which would widen sidewalks, add a bike track and slow traffic along Colorado Avenue from Fifth Street to the Pier. ("Santa Monica Planning Commission Wants More Commitment from Hotel Developer," July 26)

“These two hotels are the ideal uses in the ideal locations,” Gallen said Wednesday, “with unique world-class designs and will create approximately 500 new construction jobs and 80 new permanent jobs that will benefit Santa Monica for many years.”

He added that once completed, the “much needed, mixed-use and moderately-priced hotel projects” would “generate over $3 million a year in new revenue” for the City.

Gallen said that the hotels would be certified to meet the Leadership in Energy & Environmental Design (LEED) Gold standard. Additionally, they would be built directly across the street from the final stop on the Expo Light Rail, which, when it opens in 2016, will connect Santa Monica to Downtown Los Angeles.

"These are the hotel projects Santa Monica has been waiting for," he said.

Gallen will have to wait until the projects go back before the Planning Commission in October to find out if Santa Monica agrees.

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