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Trump’s ‘Gold Card’ Set Off Panic in an Unexpected Place: Real Estate

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Trump’s ‘Gold Card’ Set Off Panic in an Unexpected Place: Real Estate

President Trump’s plan to sell green cards for $5 million each, a program he is calling a “gold card,” has largely been met with a shrug. It’s not clear exactly how the program would work, if it’s legal or how many potential immigrants would really pay $5 million for a path to U.S. citizenship.

But in a niche area of dealmaking, alarm bells are blaring.

Howard Lutnick, the commerce secretary, said on Tuesday that the plan to effectively sell green cards would replace the EB-5 investor visa, a favorite source of funding for major real estate projects.

Massive developments — from New York’s Hudson Yards to the San Francisco Shipyard to, yes, Trump Plaza in Jersey City — have been financed in part by overseas investors applying to the EB-5 program, which grants permanent U.S. residence. Such investors are motivated by a green card, not by maximizing returns, and so for developers their capital tends to be less expensive than borrowing money from a typical commercial lender.

The real estate company owned by the family of Trump’s son-in-law, Kushner Capital, drew scrutiny for its use of EB-5 funding during the first Trump administration.

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Overall, the EB-5 program does not bring in a lot of money — about $4 billion last year in the context of the $28 trillion U.S. economy — but it represents a huge profit bump for a small but powerful political contingency: major real estate developers. They are not likely to see EB-5 killed without a fight.

“Cheap capital is the crack cocaine to the real estate industry and probably every other industry,” said Matt Gordon, the C.E.O. of E3iG, which advises both foreign investment-based visa applicants and U.S. companies seeking funding.

“They and their rather large political donations are going to be very motivated.”

Some background: EB-5 visas were established in 1990 to encourage investment in rural and economically depressed areas. Foreigners who invest either $800,000 or $1.05 million, creating at least 10 jobs, are eligible. Initially, that meant directly creating 10 jobs. Now most companies meet the requirement by showing the overall economy will gain 10 jobs as a result of each investor’s funding.

All sorts of companies can seek EB-5 investment — DealBook heard about pharmacies, hospitals, day care centers and manufacturing plants that raised money through the program — but the vast majority are real estate deals.

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News of Trump’s gold card plan sent this ecosystem reeling. “Naturally the whole world is panicking,” said Ishaan Khanna, the president of the American Immigrant Investor Alliance, a group that lobbies on behalf of EB-5 investors. “As India and China woke up, my phone blew up.”

“Everybody I’m hearing from is like ‘rush’ — get in as much as you can, because who knows how long” the program will last in its current form, Gordon said, “On both the sponsor side and on the immigrant side.”

Developers who qualify for the program win big savings. For example: One project Gordon is working on, a $100 million 19-story apartment building, qualifies for about $35 million of EB-5 funding. Traditional mezzanine debt financing for such a project might come with an interest rate of 10 or 12 percent, Gordon said, but the developer will pay 5 to 7 percent for EB-5 funding. “You’re really cutting, you know, 30 to 50 percent of your cost of capital, on a rather significant portion of your capital,” he added.

On top of saving money, developers say the program has been crucial during periods like the financial crisis when other funding sources become prohibitively expensive or scarce.

Unsurprisingly, the real estate industry has been one of the EB-5 program’s most ardent defenders. The National Association of Realators and the U.S. Chamber of Commerce lobbied against a bill introduced in 2017 that would have terminated the program.

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Such programs aren’t unusual. Seventy countries exchange permanent residency or citizenship for investments or donations, according to Kristin Surak, an associate professor at the London School of Economics who studies so-called golden visa and passport programs worldwide. In some countries, including Malta and Cyprus, the programs represent a significant part of the economy.

Proponents point to the jobs created. Critics say the EB-5 program falls short of its goal to stimulate investment in rural and distressed urban areas. Previous iterations allowed developers to gerrymander maps so that even densely populated and highly employed districts like Hudson Yards qualified for preferable terms. A 2022 law ended that practice and added new incentives to build in rural areas.

Would selling visas work better? Lutnick said on Wednesday that EB-5 projects “were often suspect, they didn’t really work out, there wasn’t any oversight of it.” It’s true that there have been horror stories: Two investors who raised $350 million from foreign investors for a massive development in Vermont, for example, were accused in 2016 of perpetrating the biggest fraud in the state’s history.

But according to a report from the Government Accountability Office that looked at pending petitions in 2021, less than 1 percent were found to be fraudulent or posed national security risks (about 3 percent were investigated). Additional safeguards were added in the 2022 law.

The gold card may have a different problem: A dearth of applicants. Participants in the EB-5 program expect to get their $1 million investment back at some point, whereas Trump’s plan requires a $5 million donation that isn’t returned.

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The EB-5 program drew about 7,000 investments between April 1, 2022 to July 31, 2024, according to data compiled by the American Immigrant Investor Alliance. Even if the gold card comes with a tax benefit, why would a substantially larger group of foreigners — Trump said “maybe a million” — be willing to pay the much higher cost?

Many in the industry see Trump’s plan as unworkable. Trump would need congressional approval both to abolish a visa program that was created by law and to allocate visas for a new one. “This is unpredictable,” Khanna said. “No one truly knows where this is going.”

More than Trump’s recent announcement, which lacked specifics, many of the big players in the ecosystem — including the companies that put together the funds, the developers and the lawyers — are focused on what will happen in 2027, when the EB-5 program expires and needs to be renewed by Congress.

They’re betting on compromise. The players in such investments are hoping the gold card becomes an addition rather than a replacement.

The idea may already be breaking through: By Wednesday, Lutnick had changed how he described the gold card plan, saying it would “modify” the EB-5 program, but it was unclear what specifically would change.

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— Sarah Kessler

President Trump’s meeting with President Zelensky of Ukraine turned into an explosive shouting match on live television, a moment unlike anything we’ve ever seen at the White House. At an Oval Office appearance Friday the Ukrainian president met with Trump to sign a mineral rights deal, when Trump accused Zelensky of being ungrateful and “gambling with World War III.” Zelensky had questioned whether Trump would be able to get President Putin of Russia to honor a peace agreement without security guarantees, saying the Russian leader had broken cease-fire accords in the past. Vice President Vance, sitting on a nearby couch, chastised Zelensky for not showing more appreciation for Trump’s efforts. The U.S. president then issued an ultimatum: “You’re either going to make a deal or we’re out.” The fiery exchange (here’s the video) revealed Trump’s nakedly combative approach to dealmaking. Zelensky left without signing the mineral agreement. Elon Musk, whose Starlink satellite internet service has been vital to Ukraine’s military defenses, seemed to praise Trump on X after the exchange.

Shari Redstone urged her board to find a resolution with President Trump. Redstone, who is trying to sell Paramount, her family business, to David Ellison’s Skydance, directed her board to find a way to resolve Trump’s lawsuit against the company’s CBS News division, DealBook was first to report. The president sued the company last year for $20 billion, accusing the network of deceptively editing an interview with Vice President Kamala Harris to cast her in a more favorable light. Even though legal experts say Trump has a weak case, some Paramount executives feel a settlement would smooth the way with the Trump administration toward greenlighting the company’s Skydance merger.

Apple’s Tim Cook gave a lesson in the art of dealmaking with President Trump. The Apple leader drew praise from Trump for his commitment to invest $500 billion in the United States and create 20,000 more jobs over the next four years. The stakes are high for Apple because its iPhones are primarily made in China, which faces an additional 10 percent tariff on exports. But Cook appeared to take a page out of his playbook from Trump’s first term, when he pledged more U.S. investment and won tariff exemptions. By the way, that $500 billion commitment was probably already earmarked. Expect similarly framed corporate announcements to follow.

The S.E.C. said memecoins aren’t like stocks and bonds. That means you and I can trade them at our own risk and the novelty crypto tokens — including those tied to President Trump and the first lady, Melania Trump — won’t be subject to regulatory oversight. Trump, whose presidential campaign was backed by top crypto executives, has promised less regulation for the industry. Even so, the price of Bitcoin has plunged in recent days, stoking concern about crypto volatility.

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President Trump and President Putin of Russia marked the third anniversary of the Kremlin’s full-scale invasion of Ukraine this week with a similar message: Russia will soon be open for business. Never mind that Russia and the United States remain far apart on the fundamental terms of a peace negotiation, or that Russia is under heavy sanctions by Western countries, or that uncertainty over the region’s future has only grown after yesterday’s Oval Office blow-up.

DealBook spoke with Charles Hecker, a former reporter for The Moscow Times and a geopolitical risk consultant who for decades advised Western companies on expanding their business in Russia, about the prospect of business leaders taking Trump and Putin up on the pitch. (A reminder: most, but hardly all, Western companies left Russia shortly after war in Ukraine broke out.)

Hecker is the author of the book “Zero Sum: The Arc of International Business in Russia,” which is set for publication in the United States next week. This interview has been edited for brevity.

The assumption is that Western, and especially American companies, will not return to Russia any time soon. How do you see it playing out?

Inside a number of companies, conversations are already taking place about whether and how to go back to Russia. And those conversations probably preceded this flurry of diplomatic activity between Moscow and Washington. There are also companies that have decided already, resolutely, that they are not going back. What this speaks to is risk appetite. There are clearly companies that have cast iron stomachs and bottomless appetites for risk. Those are the companies that are probably considering going back to Russia most actively.

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Who might they be?

These are companies in the energy sector, and more broadly, in the natural resources sector. These are companies that are thoroughly accustomed to doing business in very-high-risk jurisdictions.

For companies with a higher appetite for risk, what kind of negotiated resolutions between the West and Russia would they view as a kind of all-clear?

One of the red lines is sanctions. If part of the resolution of the war on Ukraine is sanctions relief, then there will be companies that see that, essentially, as a signal to go back.

What kind of Russia is waiting for them?

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Over the past three years there have been some changes that have taken place that will be very, very difficult to reverse. We all know of the famous headline-grabbing nationalizations and reallocations that took place, like Danone and Carlsberg — really high profile expropriations. There is a new business elite in Russia that is one level below the individuals who have been sanctioned who serve largely at the pleasure of the Kremlin. This new business elite has possession of a great number of very shiny new toys that were previously Western companies. It’s a valid question to ask about whether these new owners are going to want to give their shiny new toys back. And if they do, whether under political pressure or otherwise, what would the cost be?

Thanks for reading! We’ll see you Monday.

We’d like your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.

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In-N-Out Burger outlets in Southern California hit by counterfeit bill scam

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In-N-Out Burger outlets in Southern California hit by counterfeit bill scam

Two people allegedly used $100 counterfeit bills at dozens of In-N-Out Burger restaurants in Southern California in a wide-reaching scam.

Glendale Police officials said in a statement Friday that 26-year-old Tatiyanna Foster of Long Beach was taken into custody last month. Another suspect, 24-year-old Auriona Lewis, also of Long Beach, was arrested in October.

Police released images of $100 bills used to purchase a $2.53 order of fries and a $5.93 order of a Flying Dutchman.

The Los Angeles County District Attorney’s Office charged Lewis with felony counterfeiting and grand theft in November.

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Elizabeth Megan Lashley-Haynes, Lewis’s public defender, didn’t immediately respond to a request for comment.

Glendale police said that Lewis was arrested in Palmdale in an operation involving the U.S. Marshals Task Force. Foster is expected in court later this month, officials said.

”Lewis was found to be in possession of counterfeit bills matching those used in the Glendale incident, along with numerous gift cards and transaction receipts believed to be connected to similar fraudulent activity,” according to a police statement.

A representative for In-N-Out Burger told KTLA-TV that restaurants in Riverside, San Bernardino and San Diego counties were also targeted by the alleged scam.

“Their dedication and expertise resulted in the identification and apprehension of the suspects, helping to protect our business and our communities,” In-N-Out’s Chief Operations Officer Denny Warnick said. “We greatly value the support of law enforcement and appreciate the vital role they play in making our communities stronger and safer places to live.”

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The company, opened in 1948 in Baldwin Park, has restaurants in nine states.

An Oakland location closed in 2024, with the owner blaming crime and slow police response times.

Company chief executive Lynsi Snyder announced last year that she planned to relocate her family to Tennessee, although the burger chain’s headquarters will remain in California.

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Newsom’s budget includes $200 million to make up for Trump’s canceled EV rebates, among other climate items

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Newsom’s budget includes 0 million to make up for Trump’s canceled EV rebates, among other climate items

Gov. Gavin Newsom on Friday doubled down on California’s commitment to electric vehicles with proposed rebates intended to backfill federal tax credits canceled by the Trump administration.

The plan would allocate $200 million in one-time special funds for a new point-of-sale incentive program for light-duty zero-emissions vehicles. It was part of a sweeping $348.9-billion state budget proposal released Friday, which also included items to address air pollution and worsening wildfires, amid a projected $3-billion state deficit.

EVs have become a flashpoint in California’s battle against the Trump administration, which moved last year to repeal the state’s long-held authority to set strict tailpipe emission standards and eventually ban the sale of new gas powered cars.

Last year, Trump ended federal tax credits of up to $7,500 for EV customers that were part of President Biden’s 2022 Inflation Reduction Act. In September, his administration also let lapse federal authorization for California’s Clean Air Vehicle decal program, which allowed solo EV drivers to use carpool lanes.

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“Despite federal interference, the governor maintains his commitment to protecting public health and achieving California’s world leading climate agenda,” Lindsay Buckley, spokesperson for the California Air Resources Board, said in an email. “This incentive program will help continue the state’s ZEV momentum, especially with the federal administration eliminating the federal EV tax credit and carpool lane access.”

Newsom had previously flip-flopped on this idea, first vowing to restore a state program that provided up to $7,500 to buy clean cars and then walking it back in September. That same month, a group of five automakers including Honda, Rivian, Hyundai, Volkswagen and Audi wrote a letter urging Newsom and state legislators to establish a $5,000 EV tax rebate to replace the lost federal incentives, Politico reported.

During his State of the State speech Thursday — one year after the devastating Palisades and Eaton fires in Los Angeles — Newsom said California “refuse[s] to be bystanders” while China and other nations take the lead on electric vehicles and the clean energy transition. He touted the state’s investments in solar, hydrogen, wind and nuclear power, as well as its recent move away from the use of any coal-fired power.

“We must continue our prudent fiscal management, funding our reserves, and continuing the investments Californians rely on, from education to public safety, all while preparing for Trump’s volatility outside our control,” the governor said in a statement. “This is what responsible governance looks like.”

Several environmental groups had been urging Newsom to invest more in clean air and clean vehicle programs, which they say are critical to the state’s ambitious goals for human health and the environment. Transportation is the largest source of climate and air pollution in California and is responsible for more than a third of global warming emissions, said Daniel Barad, Western states policy manager with the nonprofit Union of Concerned Scientists.

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“As federal attacks threaten California’s authority to protect public health, incentives are more essential than ever to scale up clean cars and trucks,” Barad said. “The governor and legislative leaders must act now to fully fund zero-emission transportation and pursue new revenue to grow and sustain climate investments.”

Katelyn Roedner Sutter, California senior director with the nonprofit Environmental Defense Fund, called it “an essential step to save money for Californians, cut harmful pollution, spur innovation, and support the global competitiveness of our auto industry.”

While the budget proposal does not include significant new spending proposals, it contains other line items relating to climate and the environment. Among them are plans to continue implementing Proposition 4, the $10-billion climate bond approved by voters in 2024 for programs geared toward wildfire resilience, safe drinking water, flood management, extreme heat mitigation and other similar efforts.

Among $2.1 billion in climate bond investments proposed this year are $58 million for wildfire prevention and hazardous fuels reduction projects in vulnerable communities, and nearly $20 million to assist homeowners with defensible space to prevent fire. Water-related investments include $232 million for flood control projects and nearly $70 million to support repairs to existing or new water conveyance projects.

The proposal also lays out how to spend money from California’s signature cap-and-trade program, which sets limits on greenhouse gas emissions and allows large polluters to buy and sell unused emission allowances at quarterly auctions. State lawmakers last year voted to extend the program through 2045 and rename it cap-and-invest.

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The spending plan includes a new tiered structure for cap-and-invest that first funds statutory obligations such as manufacturing tax exemptions, followed by $1 billion for the high speed rail project, $750 million to support the California Department of Forestry and Fire Protection, and finally secondary program funding such as affordable housing and low-carbon transit options.

But while some groups applauded the budget’s broad handling of climate issues, others criticized it for leaning too heavily on volatile funding sources for environmental priorities, such as special funds and one-time allocations.

The Sierra Club called the EV incentive program a crucial investment but said too many other items were left with “patchwork strategies that make long-term planning harder.”

“Just yesterday, the Governor acknowledged in his State of the State address that the climate risk is a financial risk. That is exactly why California needs climate investments that are stable and ongoing,” said Sierra Club director Miguel Miguel.

California Environmental Voters, meanwhile, stressed that the state should continue to work toward legislation that would hold oil and gas companies liable for damages caused by their emissions — a plan known as “Make Polluters Pay” that stalled last year amid fierce lobbying and industry pressure.

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“Instead of asking families to absorb the costs, the Legislature must look seriously at holding polluters accountable for the harm they’ve caused,” said Shannon Olivieri Hovis, California Environmental Voters’ chief strategy officer.

Sarah Swig, Newsom’s senior advisor for climate, noted that the state’s budget plan came just days after Trump withdrew the United States from the United Nations Framework Convention on Climate Change, a major global treaty signed by nearly 200 countries with the aim of addressing global warming through coordinated international action.

“California is not slowing down on climate at a time when we continue to see attack after attack from the federal government, including as recently as this week with the Trump administration’s withdrawal from the UNFCCC,” Swig told reporters Friday. “California’s leadership has never mattered more.”

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Abandoned shops and missing customers: Fire-scarred businesses are still stuck in the aftermath

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Abandoned shops and missing customers: Fire-scarred businesses are still stuck in the aftermath

The charred remains of the historic Pacific Palisades Business Block cast a shadow over a once-bustling shopping district along West Sunset Boulevard.

Empty lots littered with debris and ash line the street where houses and small businesses once stood. A year since the Palisades fire roared through the neighborhood, only a handful of businesses have reopened.

The Starbucks, Bank of America, and other businesses that used to operate in the century-old Business Block are gone. All that remains of the Spanish Colonial Revival building are some arches surrounding what used to be a busy retail space. The burned-out, rusty remnants of a walk-in vault squat in the center of the structure.

Nearby, the Shade Store, the Free-est clothing store, Skin Local spa, a Hastens mattress store, Sweet Laurel Bakery and the Hydration Room are among the many stores still shuttered. Local barbershop Gornik & Drucker doesn’t know if it can reopen.

“We have been going back and forth on what it would take to survive,” co-owner Leslie Gornik said. “If we open, we have to start over from scratch.”

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Hundreds gathered around Business Block on the anniversary of he fire on Wednesday to witness a military-style white-glove ceremony to pay respects to the families who lost loved ones. Photos of those killed from the neighborhood were placed at the Palisades Village Green next door.

The Palisades fire burned for 24 days, destroying more than 6,800 structures, damaging countless others and forcing most of the neighborhood’s residents to move elsewhere. About 30 miles northeast, the Eaton fire burned more than 9,400 structures. Combined, the fires killed 31 people.

Remnants of the the Pacific Palisades Business Block, which was completed in 1924 and burned in the Palisades fire.

The few businesses that are back in Palisades serve as a beacon of hope for the community, but owners and managers say business is down and customers haven’t returned.

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Ruby Nails & Spa, located near the Business Block, was closed for eight months before reopening in September. Now business is only half of what it was before the fires, owner Ruby Hong-Tran said.

“People come back to support but they live far away now,” she said. “All my clients, their houses burned.”

Ruby Hong-Tran, owner of Ruby Nails & Spa in Pacific Palisades, says her business is half of what it was since reopening.

Ruby Hong-Tran, owner of Ruby Nails & Spa in Pacific Palisades, says her business is half of what it was since reopening.

It took months to clean all the smoke damage from her shop. The front is still being fixed to cover up burn damage.

The firestorms destroyed swaths of other neighborhoods, including Malibu, Topanga, Sierra Madre and Altadena, where businesses and homeowners also are struggling to build back.

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Some are figuring out whether it is worth rebuilding. Some have given up.

The Los Angeles Economic Development Corporation estimated last year that more than 1,800 small businesses were in the burn zones in Pacific Palisades, Malibu and Altadena, impacting more than 11,000 jobs.

Businesses say they often have been on their own. The Federal Emergency Management Agency tasked the U.S. Army Corps of Engineers to clean up debris at private residences, some public buildings and places of worship — but not commercial properties.

Business owners had to clean up the charred debris and toxic waste on their properties. Many had to navigate complicated insurance claims and apply for emergency loans to stay afloat.

Rosie Maravilla, general manager of Anawalt’s Palisades Hardware, said damage to her store was limited, and insurance covered the cleaning, so she was able to open quickly. The store reopened just one month after the fire.

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Rosie Maravilla, general manager of Anawalt Palisades Hardware, in front of of the store in Pacific Palisades.

Rosie Maravilla, general manager of Anawalt Palisades Hardware, in front of of the store in Pacific Palisades.

Still, sales are 35% lower than what they used to be.

“In the early days, it was bad. We weren’t making anything,” Maravilla said. “We’re lucky the company kept us employed.”

The customer base has changed. Instead of homeowners working on personal projects, the store is serving contractors working on rebuilding in the area.

An archival image of the area in Pacific Palisades hangs over the aisles in Anawalt Palisades Hardware.

An archival image of the area in Pacific Palisades hangs over the aisles in Anawalt Palisades Hardware, where business is down despite a customer base of contractors who are rebuilding.

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Across the street from the Business Block, the Palisades Village mall was spared the flames and looks pristine, but is still closed. Shop windows are covered with tarps. Low metal gates block entry to the high-end outlets. The mall is still replacing its drywall to eliminate airborne contaminants that the fire could have spread.

All of its posh shops still are shut: Erewhon, Lululemon ,Bay Theater, Blue Ribbon Sushi, athletic apparel store Alo, Buck Mason men’s and Veronica Beard women’s boutiques.

Mall owner and developer Rick Caruso said he is spending $60 million to reopen in August.

The need to bring back businesses impacted by the fires is urgent, Caruso said, and not just to support returning residents.

“It’s critical to bring jobs back and also for the city to start creating some tax revenue to support city services,” he said. ”Leaders need to do more to speed up the rebuilding process, such as speeding up the approval of building permits and stationing building inspectors closer to burn areas.”

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Pedestrians walk past the Erewhon market in Palisades Village that plans to reopen this year.

Pedestrians walk past the Erewhon market in Palisades Village that plans to reopen this year.

(Genaro Molina/Los Angeles Times)

Wednesday, on the anniversary of the fire, Caruso sent three light beams into the sky over the mall, which met in one stream to honor the impacted communities of Pacific Palisades, Altadena and Malibu.

The nighttime display will continue through Jan. 31.

Business Block’s history dates to 1924, when it served as a home for the community’s first ventures. In the 1980s, plans to tear it down and build a mall sparked a local uprising to save the historic symbol of the neighborhood’s vibrancy. It was designated a Los Angeles Historic-Cultural Monument in 1984.

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Tiana Noble, a Starbucks spokesperson, said the landlord terminated the company’s lease when the building burned down. Bank of America said it secured a new lease to rebuild nearby.

Business Block’s fate is still unclear. Some people want to preserve its shell and turn it into a memorial.

This week, it was ringed by a fence emblazoned with the words “Empowering fresh starts together.”

Caruso said the ruins should be torn down.

“It needs to be demolished and cleaned up,” he said. “It’s an eyesore right now and a hazard. I would put grass on it and make it attractive to the community.”

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Twisted and scorched remnants of the the Pacific Palisades Business Block still are there a year after the fire.

Twisted and scorched remnants of the the Pacific Palisades Business Block still are there a year after the fire.

A short walk from the Business Block and near a burned-down Ralphs grocery store is the Palisades Garden Cafe, one of the few places in the neighborhood to get food and drink. The small, vibrant cafe was closed for two months after the fire, during which the employees went without pay.

Manager Lita Rodriguez said business is improving, but misses the regulars.

“We used to get tons of students and teachers who live and work here,” she said. “Our customers are mostly contractors now.”

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