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Caruso raises his offer

With Americana expansion in mind, the billionaire developer bids higher to buy out the adjacent hotel.

December 24, 2010|By Bill Kisliuk, bill.kisliuk@latimes.com

Americana at Brand developer Rick Caruso has offered $6 million for the Golden Key Hotel, one of two adjacent properties the billionaire is trying to acquire in order to expand the mega-mall to completely take over the Colorado Street block.

In a Dec. 20 letter, Caruso told hotel owner Ray Patel that the offer is 22% higher than a Dec. 10 appraisal commissioned by the developer that valued the property at $4.9 million — a figure also reflected in county records.

Patel could not be reached Thursday.

Caruso wants to expand the 15.5-acre Americana by acquiring the adjacent hotel and vacant brick building next door. He told the City Council last month he would replace the structures with 60,000 to 140,000 square feet of new retail space, a plaza and upgraded pedestrian entry to the mall. Caruso estimated the new stores would generate $800,000 in annual tax revenue for the city.

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On Nov. 30, the City Council, acting as the Redevelopment Agency, gave Caruso, Patel and Henry David, owner of the vacant building, 45 days to come up with redevelopment plans, or agreements for Patel and David to sell.

The city has the power of eminent domain in the area, which was established as a redevelopment zone in the 1970s.

In the letter, Caruso said he had not heard back from Patel since a Dec. 3 meeting.

"We made the offer," Caruso spokeswoman Jennifer Gordon said. "Rick has called him several times and he has not returned any phone calls or acknowledged anything. We're trying to move this forward so it is fair to everybody."

Patel told the City Council on Nov. 30 that he would entertain Caruso's offer, but did not want to be "bullied" into selling. Patel, who is suing the Americana and the city for alleged damage to his property during construction, has since said that he would prefer to stay in business.

An offer for the vacant former recording studio that sits between Americana shops and the hotel has also been made, but Caruso Affiliated Vice President Matt Middlebrook declined to disclose details, saying negotiations were ongoing.

David could not be reached on Thursday.

County records show David's building last changed hands in 1987 and has an assessed value of $260,000.

In 2006, Caruso bought a strip mall on the corner of Central Avenue and Broadway, across the street from the Americana, for about $5.4 million.

Middlebrook said Caruso has plans to upgrade that site. That acquisition and the effort to buy the two properties next to the Americana, Middlebrook said, "demonstrate our willingness, despite what is a challenging economy for a lot of people, to reinvest and bet on Glendale's future."

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