RDA to consider $500,000 loan to Vault 350 developers

Redevelopment leaders on Monday will consider giving a half-million loan to the developers of a downtown entertainment venue.

[Juan Pardell]

What is Medina Investments putting up as collateral. If they're very well capitalized, why would they be seeking a loan from the RDA as opposed to applying for one at a conventional bank.

[PT Reader]

Please explain to me why a group who can "spend" $5 million in renovations needs an additional $500,000 from Long Beach taxpayers and cannot get private investors or a business loan from a bank. Perhaps they should have applied the nightclub venue to Detroit, where recently people lined up for what they thought were ObamaDollars.

Well said, Juan Pardell.

Enough of this foolishness. If the RDA is seriously considering this, it is TIME TO ABOLISH THE RDA.

[Spike]

Oh really, a 500K loan, on top of the 250K they already have received.

Sounds like a taxpayer BAILOUT to me.

Why not just give it to them and call it a 'stimulus' so when the venue goes under a year later it will be a clean break.

[Tony]

This is crazy. $750.000 in loans and we don't even know if the place is going to survive. The RDA better have a backup plan when Medina and friends file for bankruptsy. Hope all the hip hop acts they have lined up bring in $$$ instead of problems for the neighborhood.

[slamHound]

Here's a Math Quiz for our LBUSD Seniors:

If an Urban Venue charges an average $7.50 for alcohol, and 2/3 of that price can be applied to repaying the Venue's $750,000 RDA loan, how many drinks must be sold at the Urban Venue in order to pay off the RDA loan? Ignore interest.

Extra credit:

If, on average, one streetfight occurs outside the Urban Venue for every 12,000 drinks sold, how many times must the LBPD respond before the RDA loan is paid off?

Extra extra credit:

If one out of every three streetfights ends in gunplay, how many times does the Coroner respond?

Economics question:

Why does a successful venue that sells alcohol qualify for a six-figure RDA loan at all??

-sH-

[honu]

It would seem that the best way to be profitable is to create a failing business model and reap finacial rewards from the public trough.

Once upon a time, people developed businesses by making a widget or providing a service others wanted and were willing to pay for. The greater the risk, the greater the reward... or you went bust.

Now "business developers" risk none of their own capitol on flimsy concepts and when they fail, walk away from the mess they made and/or run directly to the government for "working capitol".

Redevelopment funds should not be made available to businesses for day to day operations... it would be quicker and more efficient to dump the cash into a shredder.

[Lynn Jackson]

Someone related to a Union leader or City Hall pol is about to get a $500,000 Christmas gift from the stupidest citizen/voters in America.

Ingnorance is more of a tragedy than Bliss in the deficit ridden remains of today's gang and illegal infested Progressive hole that was once the proud American City of Long Beach.

[Juan Pardell]

honu wrote:

It would seem that the best way to be profitable is to create a failing business model and reap finacial rewards from the public trough.
Once upon a time, people developed businesses by making a widget or providing a service others wanted and were willing to pay for. The greater the risk, the greater the reward... or you went bust.
Now "business developers" risk none of their own capitol on flimsy concepts and when they fail, walk away from the mess they made and/or run directly to the government for "working capitol".
Redevelopment funds should not be made available to businesses for day to day operations... it would be quicker and more efficient to dump the cash into a shredder.

Very good synopsis. It would be interesting if the Long Beach City Auditor were able to comprise a financial analysis of every RDA project, from the past fifteen years, and how that has translated into a positive return on investment for Long Beach's taxpayers.

[Babycakes]

Juan Pardell wrote:

What is Medina Investments putting up as collateral. If they're very well capitalized, why would they be seeking a loan from the RDA as opposed to applying for one at a conventional bank.

Let's hope the RDA requires new financials from Medina Investments, and explores their obvious working capital deficiency.

[michael]

PT Reader wrote:

Please explain to me why a group who can "spend" $5 million in renovations needs an additional $500,000 from Long Beach taxpayers and cannot get private investors or a business loan from a bank. Perhaps they should have applied the nightclub venue to Detroit, where recently people lined up for what they thought were ObamaDollars.
Well said, Juan Pardell.
Enough of this foolishness. If the RDA is seriously considering this, it is TIME TO ABOLISH THE RDA.

they have a ist deed of trust for 2.5 million which is more that the place is worth. ther is no way any bank in this country would loan 10 cent on any kind of night club. the last vault was foreclose. and if go up or down pine the RDA claims they sunk 4 million into the place (posters in windows) plus 250k now 500k. this is a very bad deal. these loans add up to 7.250.000 at 6%(this is very high risk loan 6% is to low) thats over 4.2 million in juice with other overhead there looking at 80 to 100 grand a month plus. this place is not going to make it unless the RDA dosent get paid back. this is one of many bad deals the RDA has there buying a parking lot at 139 e. broardway for over 3 million plus about a 100 other bad deal. not only does the RDA need to be abolish the mayor and everyone else should be in prison. they have stolen 100s of millions.

[eddie g]

They should not give(loan)them a penny.The last time vault 350 was open it attracted criminal elements. The rappers and other trash,gang bangers etc are one of the reasons NO ONE goes to Pine any more!

[Medieval Pundit]

Half a mil to a failed nightclub....As eddie g correctly notes, the last time the club was in business, it was booking acts for audiences that helped bolster the sleaze-and-violence factor on Pine Avenue.

How many dozens and dozens of similar clubs are there in Hollywood? Do we really need to duplicate that scene in Long Beach?

[Medieval Pundit]

"The Vault 350" seems to be forgetting it's no longer a bank, it's a nightclub.

[Black John]

What a waste, Take your poor ideal back to drug caves of San Diego.

[Juan Pardell]

It seems quite obvious, if this particular ownership doesn't have the fiscal resources to purchase furniture, they're having some financial issues. Its puzzling. The previous renovations were done not too long ago. What was wrong with those fixtures, and why are they investing so much in cosmetic repairs?

[tom trayner]

Can you imagine being one of the poor smucks who invested in the downtown condos. The Mob in City Hall throw money at a Club that will ONLY attracted the Compton/Blue line Trash to Pine Avenue.

If we could elect a more pitiful City Government in Long Beach it would be difficult. We already scrapped the VERY VERY bottom of the Barrel.

Have we no pride whatsoever? Are LB voters really this pathetic?

WE consistently vote as though we have a Civic Death Wish for Long Beach.

[Todd]

Hey RDA....I have a piece of commercial property that I want to make into a place to hold concerts for rap artists too. We will only have an occasional fight, stabbing, and maybe a shooting here and there. Can I have $750,000 too? I promise I'll pay it back ; ) if i don't go bankrupt first. Would it look better if I give Bob Foster a big campaign donation? Please let me know.

[Pat R]

Lynn Jackson wrote:

Someone related to a Union leader or City Hall pol is about to get a $500,000 Christmas gift from the stupidest citizen/voters in America.
Ingnorance is more of a tragedy than Bliss in the deficit ridden remains of today's gang and illegal infested Progressive hole that was once the proud American City of Long Beach.

You are an idiot. Political crap about Left or Right mean nothing in LB.

The Union OWNS City Hall and Union members couldn't care less about anything or any one but getting as large a pension as possible, moving to Idaho or Colorado and forcing you idiots to support us for the rest of our lives. Screw politics, Screw Long Beach and Screw you....SUCKERS!

[What-]

Several years back the city decided to quit charging property owners downtown a fee for frontage that funded the DLBA (Downtown Long Beach Associates, which is something you automatically belong to if you own property in their "district" and cannot opt out of), but instead put it to a "vote" to begin calculating the mandatory fee by using total square footage of the property and increasing that fee by 10% every year. It was put to a vote for the property owners, and although no individual I know of who owns a building downtown voted for the massive hike to our property taxes it passed anyway. Why? Because the City is the largest property holder downtown and they "voted" yes. So please quit blaming the citizens for poor voting choices in this neck of the city. Blame the City for its corrupt business practices and sham "voting" practices.

(Oh, and we haven't seen one improvement or addition to services downtown since the property tax hike. Apparently all the cash goes to large out of town "investors" and vanity projects approved by the council that has no bearing on helping the small business owner. I used to believe in the whole idea of downtown, but now I know its just a government run scam.)

[Duh]

Don't blame City Hall. The more hopeless, violent, ignornant the population City Hall attracts the more likely they are to vote for any THING with a D beside it's name on a Ballot.

City Hall is crafty enough to sacrifice the City to their lust for the easy ride, egomania and high living which define the unqualified and unaccomplished City Hall Democrats.