The corner of Fifth Street and Colorado Avenue is on track to be redeveloped into a pair of affordable hotels. (File photo)
The corner of Fifth Street and Colorado Avenue is on track to be redeveloped into a pair of affordable hotels. (File photo)
The corner of Fifth Street and Colorado Avenue is on track to be redeveloped into a pair of affordable hotels. (File photo)

DOWNTOWN — Despite a contentious past, the developer of two proposed modestly-priced Downtown hotels and a hospitality union have reached an agreement.

The deal, executed on Friday between developer OTO and Unite Here Local 11, “essentially guarantee(s) that these will be union hotels,” OTO Director of Development Mike Gallen wrote in an e-mail.

The six-story hotels, a 136-room Marriott and a 143-room Hampton Inn, have been in the works since 2011. Tonight, City Council will hear OTO’s proposed development agreement.

After months of disagreement, Unite Here Local 11 will back the hotels at the meeting tonight, union officials said.

The agreement, according to Francis Engler, director of Westside organizing for the union, “will guarantee great jobs for the city of Santa Monica, groundbreaking job training provisions, new local hiring initiatives, and strong standards for organizing and free speech rights for workers in Santa Monica.”

OTO has made “significant changes” to the hotels based on Unite Here requests, he said in an e-mail.

One remaining detail yet to be agreed upon is the guaranteed wage for workers. City planners and OTO are comfortable with an hourly wage of $14.08 per hour, which both say is consistent with the Living Wage Ordinance adopted by City Hall. But the union and the Planning Commission support an hourly wage of $15.37 per hour, not including benefits.

Calculated over 52 40-hour work weeks, the $15.37 rate means an extra $2,683.20 annually for workers before taxes.

Tying future wage increases to the rate established by the Living Wage Ordinance is fine with the union, Engler said.

“We know that this has at times been a long and difficult process along the way, but feel that the projects are much better having gone through the process and I am proud to say that we can now fully support all aspects of these projects as proposed,” he said.

In a letter sent to council last week, the Santa Monica Democratic Club concurred with the $15.37 hourly rate, but otherwise supported the construction of the proposed hotels.

“We believe that the general concepts of the project are appropriate for the site and could be beneficial additions to the community, provided these issues are satisfactorily addressed,” the letter stated.

Last month, the Planning Commission recommended that council vote down the project unless a series of changes were made to the development agreement, including the increased living wage.

In addition, they’re asking for OTO to pay $1.7 million in community benefits, including $1 million to the Colorado Esplanade, a transit mall planned for the area. Planning officials and OTO are in favor of including $1.3 million in community benefits.

The commission asked for the removal of a set of columns by the Marriott’s entrance, a recommended change originally proposed by planning officials who said they would block the walkway. In OTO’s newest design, the columns are not gone but they’re set back closer to the building. This is better, planning officials said, but they remain concerned about the placement. They are recommending that the Architectural Review Board scrutinize the columns during its final review.

Last week, the managing director of American Film Market, the world’s largest film market, complained about the lack of affordable hotels in the city and expressed frustration over the uncertainty surrounding these proposed hotels.

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