The proposed buyer of the aging AES power plant says he has nixed a deal with Redondo Beach that would have provided the city with 25 acres to turn into parkland.
Developer Leo Pustilnikov, who has been in escrow to buy the Redondo Beach power plant for more than a year, said in a statement on Thursday, March 5, that he has rescinded his offer to sell about half of the site for $2 million per acre. Pustilnikov, in his statement, said Redondo Beach officials walked away from a good deal, which could now jeopardize its goal of creating a waterfront park.
But Redondo officials said they have acted in the best interest of public health and any developer of the site will need to designate a significant amount of the property to open space anyway.
Pustilnikov, 35, made the offer to sell a portion of the plant site about a year ago, although he still does not own the property. The city used that deal to apply for funding. But when the time came to sign a binding agreement, Pustilnikov said, the city refused.
“Since then, they have done nothing but delay and impede the project from going forward, so I am no longer interested,” Pustilnikov wrote.
“Now having had the benefit of working with the city for over a year on various matters,” the developer continued, “I do not trust it to operate a park in a welcoming and attractive manner and worry long term it will become derelict like the waterfront and ultimately negatively impact the remainder of the site.”
Since entering escrow on the power plant site, Pustilnikov has closed on two deals on the waterfront, one for a piece of property across Harbor Drive also owned by AES and the other for the master lease on a portion of the Redondo Beach Pier.
The city, meanwhile, had worked to get funding to buy the land from Pustilnikov. Last year, the California Natural Resources Agency awarded the city $4.8 million toward parkland and restoration. The Los Angeles County Board of Supervisors in November moved to create a special financing district to redirect tax dollars toward the parkland purchase.
The future of the AES plant, however, remains uncertain, as a decision on how long it will continue operating is pending with the California State Water Resources Control Board.
Pustilnikov said after the original deal broke down, he offered the city 21 acres of open space for free if it supported the power plant’s continued operations for another three years. AES, in return, would establish a “public benefits package to accelerate the clean up efforts prior to any entitlements,” he said
But the City Council rejected that recently in closed session, Pustilnikov said.
“Instead of rejoicing at the savings of taxpayer funds and running to claim victory,” Pustilnikov said, “the city shut down any dialogue and killed any opportunity of seeing open space activated at the site in this decade.”
Mayor Bill Brand, though, defended the city’s actions.
“The Redondo Beach City Council,” Brand wrote by email, “has made it clear they are not willing to trade public health and quality of life for private parkland as part of a future private development plan that the public has never seen.”
The AES site is currently zoned for industrial and parkland, so any future development that Pustilnikov has planned will need to face a zoning change approved by voters. City Manager Joe Hoefgen said voters will undoubtedly demand that open space be created anyway.
“His (Pustilnikov’s) offer to provide privately owned and operated open space to the community, with many strings attached,” Hoefgen said, “in exchange for the city supporting three more years of power generation is contrary to the public/private partnership that has been discussed to date.
It “isn’t really much of an offer to begin with,” he added, “when considering that the community is expected to demand a significant contribution of public open space as part of the voter approval required to allow for his redevelopment plan.”