Mayor ToddGloria reveals proposed settlement on 101 Ash Street real estate deal. Gloria was a San Diego City Councilmember when the deal was made in 2016, but isn't taking responsibility for supporting the bad deal. Gloria said he was 'deceived.'
SAN DIEGO – Mayor Todd Gloria Monday announced a potential settlement with Cisterra Development and lender CGA over the 101 Ash Street and Civic Center Plaza real estate deals that would transfer ownership of the properties to the city.
Gloria and Jay Goldstone, the city’s chief operating officer, said that while some might like to pursue litigation against Cisterra and CGA “to the bitter end,” the gamble of paying millions of dollars over the course of the next 5 to 10 years while the case and its appeals make their way through the courts — with the potential to lose and be on the hook for many millions more — was not a palatable one.
The city will be entitled to all insurance or third-party reimbursement related to the botched remediation of 101 Ash and “will be able to determine the best course of action to garner the most value from building,” a city statement reads.“The 101 Ash saga has been a civic tragedy that should infuriate every San Diegan,” he said.
“The city was a positive counterparty in those discussions and the resolution announced today is the result of all parties working hard to find a fair compromise, which we believe has been achieved,” he said. The city alleges it learned of $4.4 million Hughes was paid by Cisterra as part of the 101 Ash Street transaction through its litigation over the lease-to-own deal for the downtown high-rise, which was evacuated due to asbestos violations shortly after city workers were moved into the building. The skyscraper remains vacant, and questions and accusations abound among elected officials and the general public over how the deal went through amid apparent structural issues.
Faulconer, in responding to an audit in 2020 which found San Diego had failed to follow best practices and undergo due diligence before purchasing and leasing buildings since 2015, pushed back on the claims.