CITY HALL — Representatives from an international development company went home disappointed just after midnight Wednesday after the City Council shot down initial designs for one of the largest construction projects in the city’s history — a 960,000 square foot mixed-use project on the former Papermate site.

The site is part of a massive City Hall-led undertaking to create a transit village around the incoming Exposition Light Rail Line, which will connect Santa Monica to Downtown L.A. by 2015.

The proposal involved cutting up the existing parcel on Olympic Boulevard into five smaller ones, which would incorporate housing, office space, retail and open space, as well as new roads to help direct traffic through the complex rather than around it and onto already-congested roads like Olympic and 26th Street.

“It is the center, the focus and will be the driving force behind the transit center in Bergamot Village,” said Planning Director Eileen Fogarty.

It will also be the first and largest test of the Land Use and Circulation Element (LUCE) of the General Plan that puts rigid requirements on how developments fit into both the visual aspect of the city and the stated goal of cutting the impact of cars on traffic and the environment.

As such, the proposal failed in many counts, according to city staff.

The plan developed by Hines, one of the largest private real estate developers in the world, is an insular campus with tall, unvaried buildings with blank walls that in places create a “canyon effect” that was eschewed in community meetings, city staff noted.

The overall look of the project needed to be re-thought to involve a variety of roof heights to create a skyline, a mix of looks and a variety of visual elements to break up the big, blocky feel that the current project creates, city staff said.

Staff also took issue with the placement of certain roads, which they felt didn’t take advantage of a potential north-south connection to Olympic Boulevard.

In essence, the project complies with some portions of LUCE, but needs work on others, Fogarty said.

“The timing is right for a project like this to go forward. The location is certainly right. The mix of uses is very close,” Fogarty said. “The connections being created now with the blocks are an improvement over what is there today.”

However, she said changes need to be made in terms of circulation, the scale of buildings, uses and locations.

Colin Shepherd, who heads business activities for Hines in the region, had 10 minutes to respond to criticism.

He said Hines made a number of changes to the look of the project in response to a January, 2010 Planning Commission meeting where commissioners demanded changes in the look and flow of the project, specifically moving public space up to the fore and trying to make the project more of a “village” and less of a business park.

The most recent staff report included many suggestions that the developer could comply with, but others that would be difficult to include in the final plans from a business point of view, representatives from Hines said, including cutting up buildings to improve visual variety in such a way that corporate tenants would find them unappealing.

“We’ve met with a handful of businesses that say if they had spaces like this, they would stay here, not leave the city,” Shepherd said of Hines’ design. “When you start going to smaller floors, you create great inefficiencies.”

Hines created the plans while LUCE was still in development, Shepherd said, and maintained that the project was “entirely in compliance with the parameters of the LUCE.”

Approximately 30 onlookers took issue with that statement during public comment.

Speakers ripped the project based on its size, stating that it was incongruous with the small-town feel of Santa Monica.

“This project looks like the boxes the Water Garden came in,” said Roger Swanson of the Ocean Park Association, speaking as an individual. The Water Garden is a large office complex off Olympic and Cloverfield boulevards that has been criticized by some residents because of its size and the traffic it generates.

Planning Commissioner Ted Winterer concurred, describing the proposed buildings as uninspiring and unprovocative.

“Submit revised plans that address the needs of the staff and community,” Winterer said. “Then maybe you’ll solve our problem, and not just the applicant’s.”

Council members were similarly unimpressed, although some showed varying degrees of restraint.

“Why are you here tonight?” Councilmember Kevin McKeown asked. “Do you expect us to reverse the discussion with community and staff?”

Councilmember Gleam Davis focused on the potential of the project, asking Fogarty if the plan as conceived could be redesigned to meet staff’s standards.

“Is it your opinion that we can get this project to meet the requirements of LUCE?” Davis asked.

Fogarty confirmed that with a redesign, it could.

The council voted unanimously to direct staff to work with Hines to redesign the project to address concerns raised by residents and planning staff.

ashley@smdp.com