There have been a lot of articles about downtown LA's venerable Grand Central Market, mostly focusing on the gentrification of its vendors. But in a new article for Los Angeles Magazine, Jesse Katz reveals that the market is facing a $60m+ balloon payment, and a racial discrimination lawsuit.
The Community Redevelopment Agency, which had presided over Bunker Hill’s destruction, and the Metropolitan Transportation Authority, which was seeking to lure riders onto the newly opened Red Line, gambled. In 1993, they loaned Grand Central Square $44 million. Almost immediately L.A.’s postriot economy slumped. ... In 1997, (owner Ira Yellin) defaulted on his $2.4 million annual obligations. The agencies devised a rescue plan—only to watch Ira, in 2002, default again. The second bailout allowed Ira to pay just interest for 30 years, on average about $1 million a year, while deferring the principal until 2033. Then Grand Central would face a daunting balloon payment: $69 million. -- Los Angeles Magazine, October 2016
Now, Adele Yellin, Ira's widow, is proposing to settle the debt for $32.5m. As Katz writes, "It is astonishing to think that the market, even newly resurgent, is this fragile, its fate hinging on two public agencies taking a $37 million loss."
At the same time, Katz breaks the news that she's facing a discrimination lawsuit from two former tenants.
Their ouster was part of a “concerted effort and business plan to ‘gentrify’ the tenant base at Grand Central Market by ejecting long-term and ‘legacy’ tenants based on their race, color, national origin, and/ or ancestry, in order to replace them in the substantial majority of instances with Caucasian tenants,” the two merchants allege in a complaint pending in Los Angeles Superior Court. They contend that of the approximately 15 vendors the market displaced, only two were not ethnic minorities; and of their replacements, all but two were white-owned businesses. The case, which has not previously been reported on, seeks $8 million to $16 million in economic and punitive damages. -- Los Angeles Magazine, October 2016
Listen to the audio for much more on Grand Central Market's financial problems, and to hear about Jesse's experience behind the counter at Wexler's Deli.