Five months after restarting talks with developers of the Santa Monica Plaza project the Santa Monica City Council has once again ceased all negotiations relating to the project.

In late July, after months of debating if the controversial downtown development project violates state laws governing surplus government property, council agreed to resume negotiations on the project located at 4th and 5th Streets near Arizona Avenue.

The action did not constitute final approval, but the Plaza — and its proposed ground floor retail space, hotel and office spaces — was expected to be heard by the Planning Commission and approved by City Council sometime in 2022, city spokesperson Constance Farrell said in the summer.

However, after considering the matter this week, City Attorney George Cardona said Tuesday after closed session, Council has directed staff to cease negotiations with Clarett West Development, LLC and DLJ Real Estate Capital Partners, LLC.

Council cemented the end of the negotiations with a 4-3 vote Tuesday. Newly elected councilmembers Phil Brock, Christine Parra and Oscar de la Torre aligned with Mayor Sue Himmelrich to form a majority.

In July, the previous iteration of City Council directed staff to adjust priorities in the negotiations to better reflect the input that was received from the public throughout the process, as well as impacts of COVID-19 on the economy, city revenues, and community needs. But Himmelrich believed the project should be scrapped.

“I think it’s illegal. I think that it poses great risk to the city. And I think competition can only make this project better if we go to an RFP,” which would ensure more affordable units in the space as well as a hotel and open space, Himmelrich said in July.

Councilmember Gleam Davis said Tuesday she voted to continue negotiations because she believes the city could still get a good project out of the current developer.

“By ending the exclusive negotiating agreement arrangement, we are postponing the project for an indefinite period into an indefinite future, which will cause us to have significant delays — in terms of developing those revenue generating portions of the project, open space, as well as potential housing,” she added.

Brock said Wednesday the lease term was intolerable and the project is outdated, which is why he voted to cease negotiations.

“Let’s unite behind a new project that will be guided by a community process that is in scale with the future of our beachside community,” Brock said. “We can do better. We must do better.”

Council directed staff to return with an administrative item so the future of the public parcels could be discussed in open session.

“Sometimes you need to take a step back to move forward,” de la Torre said. “There were very compelling economic reasons to stay the course with the current developer and I appreciate the commitments made to bring us a new project but ultimately our residents deserve a breather and an opportunity to envision a better, resident-focused project on land they own.”

Brennon@smdp.com