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Downtown L.A. wants San Francisco’s pop-up secret to get shoppers back

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Downtown L.A. wants San Francisco’s pop-up secret to get shoppers back

As much of downtown L.A. continues to feel dark and deserted, local businesses want the city to steal San Francisco’s secret for firing up foot traffic.

The tech mecca has slowly begun to emerge from one of the country’s deepest declines in downtown retail, in part through a program that peppered the city with subsidized pop-up shops.

The Vacant to Vibrant program turned abandoned spaces into bakeries, bookstores, cafes, chocolateries, galleries and other things.

Local entrepreneurs were given grants and support from the city and charities, as well as months of free rent to set up shop. The idea is to leverage empty storefronts to build buzz and entice more shoppers to city sidewalks.

While San Francisco is still far from its pre-pandemic peaks, backers say the program has brightened struggling retail areas.

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“We’re creating a window on what downtown could look like,” said Simon Bertrang, executive director of SF New Deal, the nonprofit behind Vacant to Vibrant. The hollowing-out created by COVID-19 could be an opportunity to turn downtown San Francisco into a “mixed-use neighborhood with a lot of small businesses and maybe more residential,” he said.

While San Francisco is still far from its pre-pandemic peaks, backers of Vacant to Vibrant say the program has brightened struggling retail areas.

(Justin Sullivan / Getty Images)

Both L.A. and S.F. have grappled with keeping stores and restaurants in their business districts since the pandemic emptied office buildings. While most employees are working from the office again, a significant number are still working from home, and many aren’t coming in every weekday. The diminished presence of workers continues to make it hard on the lunch spots, bars and shops that rely on them to survive.

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Though it is difficult to compare how businesses are doing in each downtown, there are some indicators that San Francisco has been growing more in the last year.

Reservation platform OpenTable said online reservations in the Northern Californian city shot up more than 20% compared with most months last year. Reservation growth in L.A. was capped below 10% for most of the same period.

Downtowns across the country need to find solutions, experts warn, as dark storefronts can lead to a downward spiral, with companies hesitant to lease office space in vacant areas.

Looking down Broadway from its intersection with 7th Street in downtown in Los Angeles.

Looking down Broadway from its intersection with 7th Street in downtown in Los Angeles.

Retailers are already opting out of downtown L.A. due to its slow recovery from the pandemic shutdown, said real estate broker Derrick Moore of CBRE, who helps arrange commercial property leases.

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“A lot of operators are just electing to skip over downtown,” he said. “They’re leasing spaces elsewhere, where they feel they have a greater chance at higher sales.”

Brands have headed to more vibrant, nearby neighborhoods such as Echo Park and Silver Lake because of downtown’s weaker business.

Downtown Los Angeles residents, businesses and other city boosters want to try to prime the pump, using a program like San Francisco’s to help small businesses take over vacant storefronts and turn the lights back on, said Cassy Horton, co-founder of the Downtown Residents Assn.

A pedestrian walks past a building for lease on Broadway in downtown Los Angeles.

A pedestrian walks past a building for lease on Broadway in downtown Los Angeles.

(Etienne Laurent / For The Times)

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Surveys by the group have found that what residents love most about downtown is its walkability, restaurants, bars and coffee shops, she said.

“I love being able to live a lifestyle where I can run all of my core errands within a couple blocks,” Horton said. “I don’t have a car.”

Retail property vacancy downtown could be as high as 40%, Moore said, with some neighborhoods, such as the Historic Core, suffering more than others. Nike recently closed its store on Broadway.

A worker removes a banner on Broadway.

A worker removes a banner on Broadway. Retailers are already opting out of downtown L.A. due to its slow recovery from the pandemic shutdown, a broker said.

(Etienne Laurent / For The Times)

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“Downtown’s commercial vacancy crisis is visible on every block,” a recent report by the residents’ group said.

The report called for a “safe sidewalks” public safety campaign to work in tandem with a plan to bring back retail tenants.

In San Francisco, participating businesses can get their feet wet with a three-month pop-up to test the waters in a high-traffic location with low financial overhead and technical support from SF New Deal and the mayor’s office.

Businesses are offered grants to operate, help with lease negotiations, assistance with obtaining city permits, insurance, marketing support, business mentoring, and three to six months of free rent.

The intention is to transition many of the pop-ups into long-term leases, creating permanent fixtures in the downtown landscape. So far, more than 10 of the 40 small businesses that started as pop-ups have moved on to multiyear leases with their landlords.

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A boarded-up storefront on Broadway.

A boarded-up storefront on Broadway. “Downtown’s commercial vacancy crisis is visible on every block,” a recent report by the Downtown Residents Assn. said.

(Etienne Laurent / For The Times)

Property owners with storefronts they need to fill receive funding to cover the cost of preparing the space for tenants and other property expenses, help with city permits and other support.

San Francisco launched the program in 2023 with $700,000 and contracted with SF New Deal, which focuses on supporting small businesses in the city.

The program is also supported by corporate philanthropy from Wells Fargo, JPMorgan Chase, Visa, Gap and others.

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Among the first stores to open through the program was Devil’s Teeth Baking Co., a popular bakery in the Outer Sunset neighborhood that established an outpost in the moribund Financial District and brought followers with it.

“Suddenly, there are lines out the door on the weekend” of people waiting for breakfast sandwiches, Bertrang said.

The bakery now has a long-term lease, as do other graduates of the program, including Mello flower shop, arts-and-crafts studio Craftivity and Whack Donuts.

A pedestrian walks past shuttered stores on Broadway in Los Angeles.

A pedestrian walks past shuttered stores on Broadway in Los Angeles.

(Etienne Laurent / For The Times)

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San Francisco’s business centers were particularly hard-hit by the pandemic as its technology companies quickly adapted to remote work and kept at it even as the crisis eased, triggering widespread office and retail vacancies.

“San Francisco had the worst return-to-work situation in the nation,” Bertrang said. “It was the most extreme version of what L.A., New York and other cities in our country are dealing with.”

Representatives of nearly 40 organizations in cities across the country have reached out to him for advice on how similar programs might work in their stricken neighborhoods.

Among them was downtown L.A. business advocacy group Central City Assn., which has called for L.A. to subsidize retailers’ rents to help fill vacant storefronts in key corridors. It is working with city officials, looking into a program like Vacant to Vibrant for Los Angeles.

Adding businesses to the streets while improving public safety would help halt the “downward spiral and turn it into more of a virtuous cycle,” said Nella McOsker, president of the association.

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“San Francisco has demonstrated this larger ripple effect of success,” she said. “This is really, really doable in targeted pockets of downtown,” she said.

Nick Griffin of the business improvement district DTLA Alliance said activating storefronts is a worthy goal as long as the city first makes the streets both safe and pleasant for pedestrians.

The city needs to provide clean sidewalks, street lighting and graffiti removal before consumers and businesses return, he said.

“San Francisco was the poster child for the doom loop and has pivoted to downtown recovery,” he said. “ We are building that story right now.”

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Read Nick Bilton’s Letter to Scott Pelley

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Read Nick Bilton’s Letter to Scott Pelley

Dear Mr. Pelley:

I meant what I said in my letter last week to the 60 Minutes team: joining 60 Minutes is the honor of my career and I am grateful to be working alongside the people who have contributed to the most important television journalism brand this country has ever produced. While I’m new to 60 Minutes, I’ve devoted my career to investigative journalism and storytelling. I started this job excited to collaborate and to benefit from the wisdom and experience of the 60 Minutes veterans, with you among them. For that reason, one of the first things I did in my new role was call you to talk and invite you to dinner. It is a profound disappointment that you rejected that overture and chose ambush instead. Yesterday, you hijacked my first meeting with staff to disparage me, my qualifications, and my intentions with remarkable incivility and contempt. I welcome a diversity of viewpoints and respectful debate among the team, but this was nothing of the sort. Yesterday’s performative display of hostility enacted in front of the staff instead of in a civil, private conversation-demonstrated that you have no interest in contributing to the future success of the show, or approaching my new tenure with a mind open to collaboration and progress. I am here to deliver first-in-class news programming, not to make headlines about newsroom drama. I am eager to work alongside those who share this goal.

Despite yesterday’s misconduct, I had hoped that in sitting down with you today we could find a path forward together. You made clear that you are not interested in such a path.

Your antipathy to the future of the show has come through loud and clear. And I have heard you. I therefore write on behalf of CBS News, Inc. (“CBS”) to inform you that your employment with CBS is terminated for cause effective immediately. Enclosed is your formal termination letter.

Sincerely,

Nick Bilton

Executive Producer, 60 Minutes

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Aspiration co-founder sentenced to 14 years for fraud

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Aspiration co-founder sentenced to 14 years for fraud

The co-founder of Aspiration, Joseph Sanberg, was sentenced to 14 years in prison on Monday after defrauding investors and lenders of over $248 million.

The startup, an eco-friendly digital banking company boasting fossil fuel-free investments, carbon offsets for gas purchases, and a debit card with cash-back benefits for shopping at clean companies, was founded by Sanberg and Andrei Cherny. Cherny left the company in 2022 and has not been charged.

Sanberg, an Orange County native, pleaded guilty to wire fraud in October after being arrested in March last year. Aspiration subsequently filed for bankruptcy and liquidated all of its assets by July.

Sanberg and venture capitalist Ibrahim AlHusseini, who also faces charges, together forged a series of bank statements in order to obtain loans. From 2020 to 2021, the pair forged AlHusseini’s bank statements to show millions of dollars in assets in order to obtain millions of dollars from lenders.

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Additionally, they forged a letter from their audit committee stating that $250 million in funds were available, when in reality Aspiration had less than $1 million. The amount of loans defrauded exceeded $248 million.

In 2021, Sanberg artificially inflated Aspiration’s 2021 revenue by $44 million by recruiting 27 fake customers to sign letters of intent pledging tens of thousands of dollars per month for tree planting services. Sanberg himself funded the contracts and used the inflated revenue numbers to obtain more loans.

The charges sparked an NBA investigation into salary cap allegations due to Aspiration’s connections with Clippers owner Steve Ballmer.

Ballmer personally invested $60 million in Aspiration, all of which was lost. He is now the target of a civil lawsuit alleging his participation in the scheme. Ballmer denies the allegations.

The team announced a $300-million sponsorship deal with Aspiration, and Clippers player Kawhi Leonard signed a four-year, $28-million marketing contract with the company, which reportedly performed no duties. The issue has raised concerns about how players are circumventing the NBA’s salary cap.

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The team lost the $300-million sponsorship deal and an additional $20 million paid for carbon offset purchases.

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Monterey Park takes landmark vote on banning data centers

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Monterey Park takes landmark vote on banning data centers

Residents in the city of Monterey Park will be the first in the nation to vote on a permanent ban on data centers Tuesday.

If approved, Measure NDC would prohibit data centers within the city limits and could only be overturned by another vote.

Yard signs saying “No Data Center” in English and Chinese with images of dragons line sidewalks in the San Gabriel Valley city.

As a wave of data center opposition sweeps the country, numerous towns and counties across the U.S. have instituted temporary moratoria and other restrictions on the facilities. But only a handful have instituted indefinite bans, and just four other towns have sent related matters to the ballot.

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Supporters are hoping the vote will set a precedent for the rest of the region, where residents are fighting proposals in Vernon and City of Industry.

“This is about as permanent a ban as we can get,” said Steven Kung, co-founder of the group No Data Center Monterey Park. “Winning Measure NDC would send a huge message to the rest of the San Gabriel Valley about how residents don’t want data centers.”

The ballot measure emerged from the fight against a 247,000-square-foot center proposed in 2024 by the Australian-owned investment firm HMC StratCap for a residential area in Monterey Park.

The facility would have sat less than 500 feet away from the nearest home and used three times the electricity of the 60,000-person, predominantly Asian American city.

While the developer touted the potential for jobs and tax revenue, residents expressed concerns about noise and air pollution, rising electricity rates and a potential to lower property values.

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The company pulled its plans in late March following public outcry and a March 4 city council vote to extend a temporary data center moratorium and place a ban on Tuesday’s ballot.

In a letter to the city council, HMC StratCap said it would pursue a different use for the land and would not engage in a ballot measure fight.

The city council later banned data centers indefinitely, the first in California to do so, said Mayor Elizabeth Yang. But she’s still been out campaigning for the measure with all four other council members.

“If a council puts in an ordinance, a future council can reverse it too,” said Yang. “With the ballot measure, unbanning it is a lot harder because you need the entire city to vote on it.”

The measure proposes the ban “to protect air quality, drinking water resources, and public health” and “prevent impacts to electricity and water rates.”

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While California places third in the country for existing data centers with about 300 facilities, it hasn’t been a hot spot in the recent AI-driven data center boom. High electricity rates, expensive land and regulatory hurdles mean that fewer, and smaller, facilities are currently planned than in Virginia, Texas, Georgia, Illinois or Arizona.

“Most of California’s data centers are small by today’s standards,” said Shaolei Ren, an engineering professor at UC Riverside who studies how to reduce the environmental impacts of data centers. “Ten years ago, they would be medium-sized, but the power demand for new AI data centers has increased a lot.”

The average operating data center demands 45 megawatts, according to the Washington Post, while the average planned one would draw 430 MW. The one proposed for Monterey Park would have required about 50 MW at peak demand.

As proposals crop up in SoCal, they’re met with fierce opposition. Montebello, El Monte and Baldwin Park have all enacted temporary moratoria, and Alhambra recently banned data centers as part of a zoning code update. City of Industry, Vernon, City of Commerce and Santa Fe Springs are moving in the other direction, trying to court developers and streamline data center approvals. Community groups are fighting that.

Outside the San Gabriel Valley, residents of Coachella and Imperial County are showing up in droves to protest local proposals.

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Matthew Shaw, a volunteer with the Coalition for Responsible Data Center Development, who recently published a report on opposition to AI data centers, said a vote to ban them in Monterey Park “would lead to copycats, partially because so many groups are just opposed to any data center development at all.”

While there is no formal opposition to Measure NDC, some building trades like Ironworker Local 433 supported the Monterey Park data center when it was still live before city council. Those in the data center industry are lamenting the state of public opinion.

“These are multi-billion-dollar assets that are built by multi-trillion-dollar companies. These things will get done,” said Mehdi Paryavi, chairman of the International Data Center Authority. “My biggest problem is that our industry does not invest enough in community engagement.”

Paryavi said towns that seek to limit data centers are missing out on thousands of jobs generated by data center construction, operations and customers, as well as faster artificial intelligence speeds and better performance.

Kung said local community organizers are “looking at the empirical evidence” and seeing a ban as a win.

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“We’ve never seen a city that embraces a data center and is like, ‘Look how our quality of life has increased, look how all the revenue has gone into citywide improvements,’” he said. “That just doesn’t exist.”

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