Tuesday, July 1, 2008 | The president of the Centre City Development Corp. has been involved in the decision-making surrounding a major downtown development deal, despite saying that she had recused herself from the project.
Writing to two staff employees on Dec. 11, 2007, Graham signed a brief note: “90-day extension OK — pls. advise Related/CityLink and all concerned parties”.
She had maintained that she had nothing to do with the development because of a previous relationship with a separate subsidiary of Related of California. She acknowledged Monday that she had been partially involved.
“There were some minor things before I realized it became an issue,” she said. “As far as the significant negotiations or terms or deals I was not (involved).”
The decision itself appears unnecessary. The extension had already been granted, and Graham’s approval was not legally required. But whether Graham’s decision affected the $409 million project is not the issue.
In a May interview, Graham said unequivocally that she had recused herself from the project and had not been involved in any decision-making. She said she did not feel comfortable negotiating any agreements with Related of California, because of a previous business relationship with another Related subsidiary. Graham had jointly developed and profited from a condominium project with that separate subsidiary, Related of Florida, before she moved to San Diego.
Graham has had a long-running connection to Related’s subsidiaries, first as an elected official in Florida. While serving as mayor of West Palm Beach, Fla. from 1991 to 1999, Graham led efforts to redevelop the city’s downtown, which culminated with Related of New York, the subsidiaries’ parent company, constructing CityPlace, a $500 million revitalization project that built homes, restaurants and businesses in the city’s downtown.
After leaving office, Graham worked directly with Lennar Homes and the Related Group of Florida, jointly developing a $100 million waterfront condominium project in Lantana, a city 10 miles south of West Palm Beach. N-K Ventures, the development company she formed with her husband, shared in the profits from the condo construction.
Her relationship with Related caused friction, though, leading to her resignation from a similar redevelopment post in Florida. After taking a job as executive director of West Palm Beach’s Downtown Development Authority, she had a well-publicized rift with current West Palm Beach Mayor Lois Frankel. The two were once political allies. But Frankel told the Palm Beach Post in 2005 that she became uncomfortable with Graham’s ties to Related. Graham subsequently resigned her development post.
Graham said in May she wanted to steer clear of any controversy here and had recused herself from any involvement in the project. Though it was not legally necessary — she has divorced her former husband and sold her interest in their development business — she said she sought to avoid the perception of a conflict of interest.
It is unclear why Graham signed off on the memo. The agreement to extend negotiations had already been approved by Janice Weinrick, the city Redevelopment Agency’s deputy executive director. She said she was told to sign it by Murray Kane, a CCDC attorney. “I’m a document signer,” she said. “I only did what I was told, to sign off.”
She directed other questions to Kane, who did not return a call for comment.
John Collum, the CCDC senior project manager working on the development, said he had already processed the extension before Graham’s note came to him. “That was just a general follow-up from her,” Collum said.
Fred Maas, chairman of CCDC’s appointed board of directors, said Graham had never been involved in the project’s substance. “I have never had a conversation on any substantive matter with Nancy Graham” regarding 7th and Market, Maas said.
He said her signature on the memo did not significantly impact the project. But if she had claimed she’d been completely uninvolved, Maas said: “Clearly, she should have been more direct, if that’s in fact what happened. From my own personal experience, there’s been an absolute Chinese wall between her and [Related] and her and me.”
Extending the negotiation agreement allowed CCDC and the developers to continue discussing the terms of their final agreement to build the 41-story project, which will feature a hotel, condos and public parking. It will benefit from an $8.7 million city subsidy, be LEED-certified, offer some affordable rental apartments and have a small space for police bicycle storage.
The two sides are currently finalizing details of a development agreement, which is slated to go July 30 to CCDC’s board for a recommendation. San Diego’s City Council, sitting as the Redevelopment Agency, will have the final say.