GM Plant

gmplant6-2hm23 inches/mike1st/mark2nd By HILDY MEDINA Staff Reporter For decades, manufacturing dollars flowing from the General Motors plant in Van Nuys served as the economic lifeblood of the northeast San Fernando Valley. Now the flow, which has been cut off since the plant was closed in 1992, may be about to begin again. That prospect arises from talks being held between the City of Los Angeles and Marvin Engineering Co. Inc. to bring nearly 800 high-pay aerospace workers to the former GM plant site. Consolidating Marvin Engineering’s workers from the company’s four existing plants into one, to-be-developed facility at the GM site would go a long way towards revitalizing a community that lost more than 2,500 high-paying manufacturing jobs in 1992. “This is huge economic news,” said John Rooney, president of the Valley Economic Development Center. “It would really help revitalize the whole Valley area. When GM shut down it had a very serious impact on the ecomony.” The deal being negotiated by Los Angeles City Councilman Richard Alarcon’s office and the developer, Voit Cos. would immediately fill the entire 30-acre industrial section of the big GM redevelopment project in one fell swoop. “I think it’s an excellent opportunity for the community of Van Nuys to rebuild itself,” said John Slifko, technical advisor to U.S. Rep. Howard Berman, D-Panorama City, in whose congressional district the GM plant site is located. “(Closure of the GM plant) was a blow to the Valley. GM was an engine for the Valley through most of the post-war period. It’s exciting to see that we’re making our way back.” Jerry Friedman, executive vice president and co-owner of Marvin Engineering, said his company was recently approached by L.A. city officials who had learned about the firm’s need for extra space and desire to consolidate into one location. Marvin Engineering, primarily a defense contractor with revenues last year of $120 million, currently has plants in Inglewood, West Los Angeles and Irvine. Its fourth plant, a subsidiary in Valencia which operates under the name Aerospace Dynamics International, deals mostly in designing and manufacturing commercial airline parts. “We’ve talked to Richard (Alarcon) and his office, and in fact, we’re going to have another meeting,” said Friedman. “They’re trying to get us to take over the whole (GM industrial) facility.” The purpose of the meeting, set for a yet-to-be-determined date this week, is to discuss various incentives that may be offered, said Alarcon. The councilman described Marvin Engineering as exactly the kind of company the city is looking for. “It could be a tremendous opportunity,” said Alarcon. “(Marvin Engineering) has high-paying jobs, highly skilled employees and tremendous upward mobility.” But the cost of consolidating four plants is extremely high, said Friedman, and the only way the company would agree to the deal is if the city can show how the move could be made affordable. “Clearly, I would love to see a fruitful negotiation, but it’s not easy,” said Alarcon. “One of the biggest difficulties is its size. It’s not easy for the company to move hundreds of thousands of pounds of equipment.” Robert Lumley, a vice president at Voit, who is also involved in the negotiations, characterized the discussions as still in the infancy stage. He added that the city is busy working on its incentive package for the aerospace firm. “Because of the high-paying jobs it will bring to the community, (Marvin Engineering) would like to have some subsidy,” said Lumley. “Whether it (the package) is going to be acceptable to Marvin, I don’t want to get excited yet.” Meanwhile, Friedman, whose company has been courted by other areas as well, including Michigan, Florida and Kansas, said he is very interested in the Van Nuys site because of its location within a revitalization zone. “It’s a beautiful site in a great area,” said Friedman. “But they have to get us to the point where we could see how it would make sense to us in a business way It has to be good for L.A. and it has to be good for us.” To lure companies to revitalization zones, the city will offer a range of incentives. For example, sewer charges could be eliminated and job training programs may be provided for new employees. In some instances, the city will pay the company for every new employee hired. Another available inducement is that industrial development bonds could be issued to finance plant construction. That bond program enables the city to issue bonds and funnel the proceeds through in the form of a government-secured construction loan with a below-market interest rate. Alarcon said seven companies, mostly from the high-tech industry, have expressed interest in moving to the GM plant site, but Marvin Engineering is the only company looking to occupy the entire site. Last year, Selleck Development Group and Voit jointly purchased about 68 acres of the former General Motors site, which has stood vacant since 1992. The developers set aside about 35 acres for retail use, 30 acres for industrial purposes and the remainder was donated to the city, most likely for a police substation. Retail tenants that have agreed to move to the 35-acre retail portion of the project site include Home Depot and Cineamerica Theaters L.P., which plans to build a 14-to-20-screen Mann’s Theatres cineplex. As for the industrial portion of the site, earlier plans spearheaded by Berman envisioned a state-of-the-art biomedical “incubator” park to house up to 30 small companies. Those plans had been gaining widespread support among business, academic and government leaders. But the idea eventually grew stale because of inadequate response from the biomed community. “Anybody could come up with a great scheme, it boils down to investment. Who’s going to make that investment?” said one high-ranking L.A. city official who asked not to be named. “If we had (adequate interest and financing for) all the choices, we would consider them. We haven’t seen that (from the biomed community).”