The ballgame: developing the parking lots of Dodger Stadium to be more like the Battery in Atlanta
It is no secret that Major League owners are trying to model what occurred artificially at Truist Park in Atlanta: have a neighborhood, under team ownership, to further siphon fan interest and fan dollars. Currently, if you go to Dodger Stadium, all there is to do is go to Dodger Stadium, which is fine if want to go to a game or to an event, but it is bad if you want to do anything else.
Dodger Stadium is hardly unique in this setup. American Family Field in Milwaukee and Kauffman Stadium in Kansas City are two stadiums that come to mind that are similar. But the Royals are entertaining a move to downtown Kansas City, chasing a trend at the cost of their identity in order to further increase their bottom line.
But unlike the Royals, if the Dodgers want the nearby amenities of a Wrigleyville, a Battery (Atlanta), or a Ballpark Village (St. Louis), instead of moving, they will have to bring the proverbial mountain to Mohammed.
Frankly, the core of the Gondola project hides a similar goal, but the language in the recorded Covenants, Conditions, and Restrictions (“CCRs”) of the land where Dodger Stadium restrains the legal entity that owns the parking lots at Dodger Stadium from developing those lots with hotels and other commercial buildings.
Why do we care about such terms at a Los Angeles Dodgers news site? That question is an excellent one. You should care because the land of Dodger Stadium is governed by rules that affect the activities of what can and cannot be done at Dodger Stadium These rules are in recorded documents at the county Recorder’s office.
Unfortunately, Los Angeles County does not make these records available online due to an odd interpretation of Section 6254.21 of California’s Government Code, which states it is illegal to post the home address of any elected or appointed official on the internet without written permission. So I will be posting screenshots throughout.
In order to understand my position in an upcoming essay about the Draft Environmental Impact Report, we need to go over these concepts in pieces because this material is dry, arguably boring out of context, and confusing for the uninitiated.
Dodger Stadium: A story of three parcels of land
While most of us think of Dodger Stadium as a singular place, a more accurate description of Dodger Stadium is a plot of land separated into three plots of land with two different owners. Granted, this description is simplified as I will spare you the discussion of metes and bounds language to describe the boundaries of each plot of land because this essay is not a law class nor am I a surveyor.
As should not be forgotten, Frank McCourt’s baffling and incompetent financial mismanagement of the Dodgers was enough to drive the team into literal bankruptcy on June 27, 2011. On May 1, 2012, Frank McCourt completed the sale of the Los Angeles Dodgers to the Guggenheim Group. The following day, Magic Johnson said the following to the assembled press when asked about Frank McCourt:
“Let’s move forward, please,” Johnson said. “Frank’s not here. He’s not a part of the Dodgers anymore. We should be clapping for just that.”
No, I am not calling Magic Johnson a liar. But his statement is not technically, entirely accurate, especially when one considers the Gondola project. That statement is a fiction that we all have just decided to live with over the past decade-plus. Yes, the statement is accurate enough if one realizes that McCourt indeed has nothing to do with the day-to-day running of the team.
As was widely reported at the time, other potential ownership groups noted that McCourt was trying to hold onto a 50% share of the Dodgers’ parking lots. Ultimately, the Guggenheim group agreed to a 99-year lease with the new company created that owns the parking lots. This company was a joint venture between Guggenheim and McCourt.
Truthfully, the distinction between McCourt personally owning the parking lots and McCourt’s legal entity owning the parking lots is an important legal distinction, but one that is ultimately irrelevant to our discussion. A hypothetical is to imagine touching a piece of raw chicken with your bare hands versus a piece of raw chicken with a latex glove — it’s still the same person touching the chicken. Moreover, this hypothetical is just an excuse to share my favorite clip from “The Wire” as context.
The fact that the original legal entity, Blue Landco LLC, no longer exists does not negate the fact that the CCRs “run with the land,” i.e. they bind the successors of owners of land without the need to redraft documents to re-enforce an agreement.
Why Blue Landco was terminated, I do not know. I am still researching and sifting through the pile of publicly available documents. If I find that the reason is noteworthy, I will revisit it in a later essay. Everyone whom I have spoken to on background proffers that a different McCourt-owned legal still owns the parking lots at Dodger Stadium, so this distinction of which McCourt legal entity owns the parking lots is likely a minor technicality that does not alter the overall analysis, but I would be remiss in my job if I did not point this fact out.
As it stands there is quite a bit of layering of legal entities as to the Gondola project and sifting that back to who exactly owns what at Dodger Stadium is a far more onerous task than it should be. To keep things simple, I will be referring to the legal entity owning the parking lots as Blue Landco throughout this essay.
Introduction to CCRs
While writing up an analysis of the Draft Environmental Impact Report (“Impact Report”) of the Gondola, I realized that I kept referring back to the CCRs of the land where Dodger Stadium is when writing up a planned essay. Then I had a sobering realization. I work with trusts and estates law daily and real estate law occasionally, but most people do not.
As such, I am going to try something different to break up some of the more unfamiliar concepts related to the gondola into more manageable portions.
What are CCRs?
Generally, CCRs/CC&Rs are recorded documents listing things that a landowner can and cannot do with their property in the area where the property is. These restrictions or promises run with the land, which means that the conditions listed in the documents remain, regardless of who owns the property.
A covenant is a promise to do or not do a certain thing in the deed for the land that would not cause a loss of title. The promise must be in writing. The original parties to the promise must have intended that the promise would apply to successors (done through the language of the agreement). The promise must be about the land. The promise must relate to the usage or enjoyment of the land. For the sake of sanity, we will skip the discussion of privity and notice because this essay is not a law school class and the elements are satisfied in the gondola project.
A condition is a promise to do or not do a certain thing in the deed for the land that would cause a loss of title. Like with a covenant, the condition is a promise to do or not do a certain thing in the deed for the land. The promise must be in writing. The original parties to the promise must have intended that the promise would apply to successors (done through the language of the agreement). The promise must be about the land. The promise must relate to the usage or enjoyment of the land.
A restriction is a limit on the property to assure that the property use is consistent with the land use for the general area. For example, a restriction would cover a prohibition from turning a residential property into a commercial or agricultural property.
A hypothetical example of a covenant would be a prohibition on parking at certain spots on the property (maybe due to an existing access easement — an easement is a right to cross or otherwise use someone’s else land for a specified purpose). A hypothetical example of a condition would be a transfer of property on the condition that the property becomes and remains a hospital.
Using the above information, if someone were to violate a covenant, then that would likely lead to a fine or litigation, but the violator would still retain possession of the property, whereas a violation of a condition would result in the title reverting back to the original owner. Again, this explanation is grossly simplified for our purposes.
So what is keeping McCourt or his legal entity from fully developing the Dodger Stadium parking lots? Well apart from the language that Blue Landco shall ensure that any future development construction shall not unreasonably interfere with the operation of the Stadium, apart from temporary disruption due to construction, the language of the CCRs.
As stated above, the land of Dodger Stadium has been partitioned into three parcels. Parcel 1 is the stadium itself owned by the team. Parcel 2 (described in depth in Exhibit A-1 of the CCRs for Dodger Stadium) is primarily the surface parking lots and the loge terrace bar of Dodger Stadium. Parcel 3 (described in depth in Exhibit A-2 of the CCRs for Stadium) is also land used for surface parking lots at Dodger Stadium. Collectively, the CCRs refer to Parcels 2 and 3 as the Landco Parcels and the owner of these parcels as Blue Landco, just to keep the explanation simple.
The vast majority of the time, Parcel 1 is the only plot of land most people care about at Dodger Stadium for obvious reasons...you know, the actual baseball. However, for our purposes, we will focus entirely on Parcels 2 and 3.
In the recorded CCR for Dodger Stadium, in Section 2.1.1, both the team and McCourt (through the Blue Landco LLC) acknowledge and agree that the Blue Landco Parcels will be developed for other purposes, including potentially in connection with other-sports related development opportunities.
Later on, in this portion of the CCRs, the Required Parking Spaces initially was defined as 19,000 parking spaces, with no less than 16,500 parking spaces unless Blue Landco seeks City of Los Angeles approval and the reasonable approval of the team, and the Blue Landco parcels are serviced with “mass transportation.” Any dispute on this point would be subject to binding arbitration with procedures laid out elsewhere in the document.
For want of a place to park
The entire CCR document is quite interesting and well worth a read, but for our purposes, we shall skip ahead to Section 4.1 of the document, which governs the development of the Landco Parcels. Specifically, Article 4.4 states that the design of the parking areas, including any parking structures, shall comply with the provisions of Article 5.1.4 of the CCRs.
In Article 5.1.1 of the CCRs, Blue Landco grants the Stadium Owner a non-exclusive easement, which is a right to cross or use someone else’s land for a purpose, to not less than 16,500 parking spaces located on the Landco parcels for use at all Dodger games and events at Dodger Stadium.
Remember that the Additional Parking Areas raise the total number of parking spaces on the Landco parcels to 19,000. Blue Landco grants the Stadium Owner the right to use these spaces too. However, if Blue Landco gives the Stadium Owner six months' written notice, it can relocate or remove any of these additional Parking Spaces elsewhere, even to potential parking garages to be developed on the parking lots.
If Blue Landco wants to have less than 16,500 parking spaces at Dodger Stadium, it or the City of Los Angeles will need to connect Dodger Stadium with other areas of Los Angeles by means of mass transportation. Only in connection with the construction of any mass transportation, and “only to the extent expressly permitted by [the City of Los Angeles” and approved by the Stadium Owner in its reasonable discretion,” Blue Landco can have fewer than the minimum of 16,500 parking spaces. And if Blue Landco does not have to provide that many parking spaces, then it would be allowed to develop the parking lots into something else.
Granted, these facts as alleged were reported on indirectly by the Los Angeles Times back on May 4, 2012, and at the time, Mark Walter said that “his group is not contemplating any development [of the parking lots at Dodger Stadium] at this time...Someday, there could be. We have no plans to build now. We have no plans for parking structures now. In the next 100 years, that [development] could easily happen.”
From my perspective, 100 years became a sliver over ten.
What does all the above information mean?
You might be asking yourself a question and if you are confused, I do not blame you: all of this discussion is about parking lots, what does this discussion have to do with the proposed Gondola?
If you are asking yourself the above question, I have properly done my job. I say that statement because you will have realized the hidden “bait-and-switch” that lies at the heart of the Gondola project. And it is a required and public conversation that no one is having right now.
If you are asking yourself the above question, you can understand my upcoming argument, which we will cover next time, why the Draft Environmental Impact Report that was just released about the Gondola is fatally flawed.