Business
Queen Mary, once a sinking white elephant, shows signs of remarkable revival
The Queen Mary has for years been a landmark in the city of Long Beach, an iconic ocean liner serving as a majestic sentry at the port and a popular attraction for both tourists and locals.
But the aging ship has in recent years become more of a white elephant, in need of millions of dollars in repairs just to stay afloat.
Years of mounting financial woes, a pandemic shutdown and the need for an overhaul made for an uncertain future for the Queen Mary. Financial audits showed the ship was running a deficit, and at least one report warned that it was at risk of sinking if it didn’t get that crucial repair work.
But now, the 90-year-old ship seems to be headed for smoother sailing, with financial records showing it is finally turning a profit for the city of Long Beach.
On the ocean liner that has been turned into a hotel and tourist attraction, rooms are being booked, visitors are touring the ship, and the Queen Mary’s operator said the number of visitors had been outpacing the figures from before the COVID pandemic, signaling a new, hopefully better, era for the famous ship docked in the Long Beach harbor.
But the recent financial turnaround will do little in the short term to address the extensive repairs needed to keep the ship afloat and open to the public.
The Queen Mary closed for more than three years because of the pandemic, and stayed closed due to those much-needed repairs. But once the ship reopened in April — this time under the city’s direction instead of a leaseholder — visitors began to return in greater numbers. Although the ship still needs significant mending, new paint, new floors and other work to keep the ship safe for visitors was completed. The ship has about 200 rooms and several large halls that can be booked for weddings and other gatherings.
“Even though it’s been here since 1967, it was kind of a relaunch — a new Queen Mary if you will,” said Steve Caloca, managing director of the ship under the contracted operator, Evolution.
It was a slow reopening, with just over a dozen rooms booked in the Queen Mary in all of April. But financial records obtained by The Times show the number of bookings quickly multiplied in the following weeks.
By July, more than 4,300 room nights were booked in the Queen Mary, and the ship’s operator has seen at least 3,730 bookings a month since.
“We reopened after a 3½-year hiatus, which is nice, and we’re making money, which is nice,” Caloca said.
The Queen Mary was still operating in a deficit during the first two months it reopened, according to financial information provided by the city. By June, however, the ship’s revenue had begun to outpace its expenses.
According to city records, between June and October of last year, the ship generated more than $12.6 million in revenue and more than $3 million in profits.
It’s not just rooms in the ship’s hotel that are bringing in visitors and their cash, Caloca said.
“We were getting the word out that there are things to do here,” he said. “It’s not just a beautiful ship.”
The Queen Mary began to offer old and new tours of the 1,019.5-foot ship, and hosting events to draw in locals, such as $10 entry fees on Tuesdays, he said.
A game room and revamped observation bar are available for overnight and day guests, and the ship also rolled out the commodore’s office, where officers are available to answer guests’ questions about the ship.
“We asked, what can guests do now that they’re staying at the Queen Mary; what kind of content can we provide?” Caloca said. “We’re able to create things for people to do here in Long Beach.”
For the city, it means the Queen Mary has generated more revenue in the last few months than it did for an entire year before the pandemic shut it down.
“Because of these new investments and amenities, we witnessed more visitors within six months of opening than we did in a full year prior to the pandemic, and I’m proud to share that the Queen’s profits in 2023 finished strong by coming back into the black for the first time in years,’’ said Long Beach Mayor Rex Richardson.
But the ship has also needed, and continues to need, repairs and maintenance, Caloca said.
Much of the work done on the ship has centered on keeping it safe for visitors, as well as regular upkeep like painting, new flooring and lighting, and replacing new boilers and electrical transformers on the ship.
For the Queen Mary, which has been in dire need of repairs and work for years, turning a profit in 2023 is a significant turnabout in its recent history.
Financial audits of the ship obtained by The Times show that from 2007 to 2019, the Queen Mary saw losses of more than $31 million.
A profit could mean the ship could get some much-needed TLC to keep it financially, and literally, afloat.
“When we get excited about the money, it’s not that we made a profit,” Caloca said. “It’s that we made money, but now we can put it back on the ship that we love so much.”
The city of Long Beach took over the Queen Mary in 2021 after worries that the aging ship was not being maintained. One 2017 study of the vessel found that it needed up to $289 million in upgrades and renovations, including work to keep parts of it from flooding.
Court documents and inspection reports also found that it needed $23 million to keep it from capsizing.
Making the ship a profit center for the city has been a challenge for several lease operators that have been hired to operate the ship over the last few decades — including the Walt Disney Co.
In 2005, Queen’s Seaport Development Inc. filed for Chapter 11 bankruptcy protection and was found by Long Beach to owe $3.4 million in back rent. In 2009, the hotel was also at about a 50% occupancy rate.
Now, the profits coming in can also be geared toward new activities and entertainment to keep attracting guests into the Queen Mary, Caloca said.
This summer, operators hope to reopen a movie theater at the ship, which can double as a lecture hall and host other events, Caloca said. Another 100 rooms are expected to open by April.
“It’s not just, ‘Let’s fix it so it doesn’t break,” Caloca said. “It’s also, ‘Let’s fix it and make it so people want to come.’”
Business
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
Business
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.
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.
The team lost the $300-million sponsorship deal and an additional $20 million paid for carbon offset purchases.
Business
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.
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.
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.”
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.
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.
“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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