The Strange Tale of Johnny Lu’s Grant Deeds

Enhanced with genuine brick veneer!

By now Fullerton City Hall is aware that their partner in a boutique hotel/apartment high-rise on Santa Fe Avenue, TA Westpark LLC, is in trouble. TA Westpark Fullerton., AKA Johnny Lu has defaulted on a massive loan, previously borrowed to complete projects in Irvine.

Why is Johnny smiling?

The fallout from this embarrassment remains unknown, although there are plenty of questions that need to be answered, and sooner rather than later.

One of the questions involves the transfer of the public property ownership at the site to TA Westpark Fullerton, LLC before proper project approval, a desperate, and of course, totally unnecessary act. And the actual documents supporting ownership of the land in question need to be examined, too.

On December 22, 2022 the City sold the land at a huge discount to Lu. Check out the grant deed:

By now Craig Hostert, whose brain-child the boutique hotel was, is scratched out and TA Westpark Fullerton, LLC, a Delaware corporation, is the proud owner of the land and the transfer is signed by a “managing partner” of a whole other entity – “TA Partners.” Looks like Hosteret was bought out or walked away, abandoning his baby.

But, as they say in the infomercial, wait, there’s more. A quick check of the State of Delaware’s corporations roster doesn’t turn up any results for TA Westpark Fullerton, LLC. Hmm.

No responsive records…

And here’s something else. A few months later a new grant deed was promulgated and recorded at the County of Orange. Here, the hard to find Delaware corporation deeds the land in question over to TA Westpark Fullerton, LLC, a California corporation.

Something is odd here, and it’s not just the amateur hour handwritten changes on the original deed. Did the City sell this property to a non-existent corporate entity? If so, hasn’t some sort of fraud occurred? Why the shell game here, and could the original deed be considered invalid in retrospect?

No, I wasn’t asleep. I was praying…

We could ask these question of Dick Jones of the “I Can’t Believe It’s a Law Firm” law firm, because I doubt the City Council will make inquiries of their ace lawyer. Getting an honest answer from ol’ marble mouth? A rare and precious jewel.

Some might think this entire fiasco is going to get worse before it gets better. I’m not sure how that’s possible.

Bungled Boutique Hotel May Be In Big Trouble

Friends probably remember that FFFF has been relentlessly critical of the dubious scheme approved by our City Council to underwrite a downtown boutique hotel and uber-dense apartment project on a parking lot owned by the City and used by Metrolink commuters.

Here’s a reminder: three councilmembers Bruce Whitaker, Shana Charles and Ahmad Zahra voted to sell this property to a developer for a mere $1.4 million (less site material removal) while simultaneously time jacking up the value of the land by approving density 2.5 times the limit specified in the Transportation Center Specific Plan. It was a gift of public funds at least ten million dollars.

Here’s the fun part. The original and completely unqualified baby daddy of the project, Craig Hostert, didn’t have the wherewithal to make the deal. After years of failing to perform on his Exclusive Negotiating Agreement and numerous extensions, Hostert’s West Park Investments, LLC joined its non-existent forces with TA Partners Development of Irvine, Johnny Lu, proprietor.

Mr. Lu, the new face of the project, appeared at council meetings to seal the deal with a ration of gobbledygook bullshit.

Now it appears that Mr. Lu may not have been the best choice of partner according to the Real Deal Real Estate News.

Why is Johnny smiling?

It seems that Johnny has gotten himself in over his head on two projects in Irvine, including second bridge loans that he has now defaulted on. And of course Sunayana Thomas, Fullerton’s crack “business development” director seemingly failed to inform the City Council of Mr. Lu’s impending financial embarrassment, something that should have been revealed in even a cursory perusal of TA Partners’ asset to debt ratio and its balance sheet.

And then, of course there is the problem with the completely incompetent concept of rushing the approval to transfer of title to the land, before the deal had received final approval.

By now the Council has possibly, though not necessarily been informed by the Fullerton City Manager, Eric Leavitt, of the problem, but where does the deal stand? Title to the property has been transferred from the City to and through Lu’s companies*, presumably for the original sale amount. But if TA Partners can’t perform, will the City get its now very valuable property back, or will it be encumbered by bankruptcy receivers? Will the City, in order to save face as it always has, permit Mr. Lu to assign his rights and interests to another party as a face-saving strategy? If that happens, will the original bad idea still go forward, or will the Council approve something even worse as a sop to a new developer so to avoid admitting their horrible mistake in the first place?

You can try asking Whitaker, Charles, or Zahra, the architects of this inexcusable and completely avoidable mess, but don’t hold your breath waiting for a response.

* Topic of future post

Part II: Is the “Trail to Nowhere” Poisoned?

It could be. Last post I described how the the UP Park was contaminated and shut down for remediation just after $2 million were sunk into building a park. Nobody in the City bothered to do an Environmental Analysis.

I asked, rhetorically, whether the rest of the long UP right-of-way had been subsequently tested for toxins in light of the fact that trichloroethylene (TCE) had been detected on the property at 311 South Highland Avenue, a property adjacent to the proposed Trail to Nowhere. It seems that some years ago the Hughes Corporation used the solvent to clean up the circuit boards they made at this location, and the EPA still regards it as an active site.

A trail runs through it…

A little digging uncovered the fact that ground zero seems to be the west end of the property where testing has been periodically done in the area of a likely dump site for the nasty TCE toxin. Apparently there are several monitoring wells located in the yellow areas circled in red in the image below.

Please note the proximity to the Trail to Nowhere of the wells in the lower left. 15 feet? 10 feet? 5ft? Surely somebody in the Parks or Engineering Departments gave thought to this when the Trail to Nowhere concept was developed; when the grant application was made; even when the proposed project budget was laid out. No? If not, why not? How could they not have known? The EPA has recognized this as a site of TCE ground water contamination where a toxic plume is heading southward – under the proposed trail.

At this point questions are starting to pile up. Questions that may have uncomfortable answers.

We are fortunate that Messrs. Dunlap, Jung and Whitaker have put the kibosh on the silly and wasteful Trail to Nowhere proposal for other common sensical reasons. And yet there remains the problem about lack of disclosure to our elected officials in their decision making process, and perhaps even in the grant application itself.

The Mantra of Economic Development

No news is good news…

A Friend just forwarded an article in the Yellowing Fullerton Observer about the City’s latest foray into something called economic development – an effort to create more tax revenue, somewhere, somehow, sometime. The good folk in City Hall are alarmed at the looming budget deficit they forecast in the next few years. And they know full well that another attempt at a sales tax like the ill-fated Measure S promoted by Ahmad Zahra and Jesus Quirk-Silva would be a shaky proposition.

According to the Observer the City hired an entity called Kosmont Companies to assay Fullerton’s future and determine where tax generating opportunities may lay. At the June 20th meeting of the City Council a report by Kosmont was submitted for general perusal.

Exhausting all options…

I note that Kosmont Companies is an operation whose sole raison d’etre these days is to work for Redevelopment Successor agencies and municipalities trying to gin up revenue to support the bureaucratic establishment. According to the staff report Kosmont was employed by “the City” in February 2023; since no agenda report exists for this contract, it must have been executed out of the public eye by our esteemed City Manager, Eric Levitt. I’ll address the report itself and the Council’s reaction in another post.

I often wonder why anybody thinks local government have any business promoting these types of endeavors. Government employees know little about business operations, nothing about the concept enterprise; they know defined benefit pensions, their union agreements and petty, make-work bureaucratic stuff. These same chuckleheads just up-zoned and entitled a massive apartment project on land they sold to the developer for 10% of its new value. As far as the unknown amount paid to the “consultant” I wonder if even that expense will be recouped by their own work product.

Just as bad, the economic development concept is created and run, for and by, the same people who stand to benefit from it – it it were to even work at all. And of course there is never any accountability for public resources expended in the pursuit of this talisman.

A Massive Gift of Public Money

In December, as the Friends will remember, the City of Fullerton sold a public parking lot to a so-called developer for $1,400,000. The “developer” had the task of building a boutique hotel and an apartment block. FFFF has already documented the ridiculous density the City has bestowed upon the project. So let’s revisit the topic of land value, a calculation based on the number of residential units a developer can cram onto a parcel of land.

Look, it even has the café the bureaucrats demanded!

In this case we know precisely how many units are proposed because the development agreement tells us. There are going to be 141 apartment units and 118 hotel rooms – rooms that will undoubtedly be converted to low income housing when the hotel concept fails. Dividing 259 units by $1.4 million gives us $5400 per “door” as they say in the biz.

Does that number seem low? I didn’t really know, so I contacted some pros at Land Advisors who informed me that a more typical number is in the range of $60,000 to $65,000 per unit in these parts, which produces a land value of about $15.5 million and above.

So the “economic development” geniuses in City Hall got the City Council to agree to a massive reduction in value for the sale of the land, a reduction that could be in the neighborhood of $14,000,000.

Now we all know that government and its agents shield themselves (or try very hard to) from accountability for this type of incredible giveaway. It’s not a crime to be stupid, and so there the issue of legal malfeasance can be fuzzy without proof of corruption. But here there is the issue of misfeasance that in this case justifies the initiation of a recall of the elected representatives who voted for this evident gift of public funds.

Mother’s milk…

And those three representatives are Ahmad Zahra, Shana Charles and Bruce Whitaker.

Now, undoubtedly, these three politicos would argue that they had great reasons for “subsidizing” this boondoggle, and that those excellent reasons are well-worth the $14,000,000 they happily pitched at the developer, an individual, we must remember, who brought this unsolicited proposal to the City. But the City, remember, never did its due diligence by opening up this concept (or any other) for a submission of qualifications by those who might have been interested. No. Not even after several years had gone by and the proposer had been granted several extensions of a Exclusive Negotiating Agreement and the proposal kept metastasizing.

Are a “boutique” hotel at the train tracks and yet another overbearing apartment block so important that they justify the $14,000,000 giveaway? Well, I would challenge Charles, Whitaker and Zahra to prove it to voters in their districts.

The 2022 Emily Roe Voters Guide!

With ballots being mailed out in next week, it is time for my Fullerton 2022 Emily Roe Voter Guide.

With two districts and six candidates, the choices Fullerton voters will make in November can enhance government accountability and fiscal responsibility.

DISTRICT 3

Shana Charles

An associate professor in the public health department at Cal State Fullerton, Shana Charles has never served on a City of Fullerton commission or committee. As an associate professor in public health, Charles has little to no qualifications to serve on City Council as far as we can tell. Why are you not running for Fullerton School District Board Shana? You seem way more qualified for that than this generous leap to run for City Council. Charles failed to win her last race for School District in 2018. She turned around and tried, unsuccessfully to get appointed to Fullerton City Council in 2019, and then again turned around and unsuccessfully tried to get appointed to Orange County Board of Education this year. 

Those who seek power are not qualified to hold it. 

Charles is a socialist, who has no experience and is not qualified for City Council just like the old disaster Pam Keller. She skipped the only public forum so far so voters had no idea what she stood for beyond her tell us nothing candidate website. And then the Fullerton Observer questionnaire.

When asked about housing in Fullerton, Shana’s answer was: “With median home prices at $900,000 and rentals for $3000, our city cannot house its essential workers. We must work with any and all available programs to provide relief”. Sounds like code for rent control and building low income housing in mass. Fullerton would be the next Santa Ana under Shana’s leadership.

Her thoughts in the city budget being balanced for the first time in decades: “Our current budget is penny wise, pound foolish”. So you would spend money we don’t have as a city to pay for programs like low income housing and rental assistance. Fullerton was a small step away from insolvency before this current Council made the necessary cuts to maintain reserves. But for Shana turning Fullerton into the next Westminster is a good goal. 

Arnel Dino

Fred Jung’s appointee to Planning Commission, Arnel Dino is the Commission’s Vice Chair. His voting record on Planning Commission is in line with solid Planning Commissioners in Fullerton’s recent history like Bruce Whitaker, Nicholas Dunlap, and Ryan Cantor. He is visibly clunky and sometimes talks more than he should, but he could be a viable City Council selection that will mark a huge improvement from the previous Jesus Quirk-Silva. Dino served on the Infrastructure Committee. His resume is extensive so Dino has governing experience that he will need. We are not on fire over Dino, but he could be the best of poor choices. Dino’s forum performance was not off the charts great, but was not a disaster either.   

Johnny Ybarra

After failing miserably to run for City Council in District 5 in 2018, the election that gave us Ahmad Zahra, Johnny Ybarra is now running in the District where he actually lives. The former carpetbagger is a real estate agent. Not sure what to make of his candidacy since he seems to only have signs around. But his answers during the only forum so far – Fullerton Collaborative – was an unapologetically misadventure. He sounded both unqualified and uninformed. The bar is not high to beat Ybarra who is finally being honest and running in his actual District.

DISTRICT 5

Tony Castro

Wow is this kid shot out of a cannon! Not sure how much Red Bull Tony Castro drinks, but leave some for the rest of us buddy! Pro rent control and pro police reform, Castro is hellbent on turning Fullerton into the next Santa Ana, crime ridden and filled with homeless. Castro participated in two forums so far: Fullerton Collaborative and Fullerton Observer. The answers he gave were unbalanced and unbelievable. He actually said that in 2019 Fullerton had a “21 million dollar surplus”! What!?! Did you Google that son? Because Wikipedia is not good governance. 

Oscar Valadez

Oscar Valadez is the best choice of all six candidate running for City Council. A family man, father of two, graduated from Stanford University and has been a church going, volunteer in his community, a community he was born and raised in. He too lacks experience in governing, but he did participate in both Fullerton candidate forums and his answers were thoughtful and articulate. He said he wants to be a “bridge between the community and city staff to implement effective policies”. That sounds like government efficiency, hopefully government accountability and better customer service. His answers to the Observer questionnaire speaks to a man who is prepared to lead with humility, a welcome change for District 5. 

Regarding homelessness the candidate responded: “Fullerton needs to find ways to compassionately enforce our anti-camping ordinances”. Yes.

Commenting on leadership, Valadez answered: “Public representatives must be reminded that they serve for the good of the residents. Council members must prioritize problem solving and focus on building and maintaining productive relationships based on trust. As a fresh voice, I’d focus on collaboration and remain grounded in serving, not myself, but our residents”. Amen. 

Valadez could be a brighter future for Fullerton.

Ahmad Zahra

Not sure what more needs to be said about Ahmad Zahra. He’s the incumbent so Castro and Valadez have a mountain to overcome in an election cycle that will feature historically low voter turnout and engagement. When the public is uninformed or in the case of Zahra, misinformed, it is ample space for bad actors like con artists and ponzi schemers to thrive and that is exactly what Zahra has done, misled and manipulated Fullerton residents, the Fullerton unions, the Fullerton business, the Fullerton Observer, etc. During both candidate forums and the Observer questionnaire, Zahra took credit for everything short of creating the internet. The hubris is astonishing. 

Four more years of Zahra will bankrupt Fullerton, both fiscally and morally.

There is a simple question: Do you support the direction of government accountability, fiscal sustainability, and money for streets and roads that Fullerton seems to be going in under Dunlap and Whitaker? 

If the answer is yes, the choices are simple. 

COVID ZAHRA

When things get tough, real leaders make difficult choices. And then there are those like Ahmad Zahra.

When Covid 19 rolled around in the spring of 2020 Fullerton was already looking at financial disaster. Years of unbalanced budgets were backfilled by reserve funds by the partnership Fitzgerald, Flory, Silva and Zahra. With the Covid lockdown things looked bleak.

What to do?

“I know” said Ahmad Zahra, “lets have a sales tax.”

And so the ill-fated Measure S was placed on the ballot by the same herd: Fitzgerald, Flory, Silva and Zahra. The proponents didn’t seem to care that sales taxes are inherently regressive, and Zahra seemed uninterested in the fact that his D5 constituents would be disproportionately hurt. Ironically, at the time, Zahra was hauling in $4,000 a month for a few hours time as an appointed member of the Orange County Water District Board.

Later, in 2021, when federal relief money rolled in to Fullerton, Zahra tried to direct funds away from infrastructure and into salaries and pension obligations.

Well, those chickens have come to roost. This mail piece landed in D5 mailboxes today:

Oops!

And the back side:

You have something he wants…

LEADERS NOT LIARS

The Fullerton Collaborative hosted a candidate forum, which featured some good questions and some not so good. It featured 5 out of 6 City Council candidates running in Districts 3 and 5 this year. Shana Charles received a hall pass and did not stay for the forum.

Ahmad Zahra was his usual full of himself self. The notorious man who never wasted a selfie opportunity was untruthful, effortlessly deceived the audience, remaining true to his duplicitous self.

SERIAL LIAR

Here’s a list of the many, oh, so many lies.

LIE #1: “The district I’ve called home for the last 21 years.”

TRUTH: Zahra’s voter registration record doesn’t agree.

LIE #2: “As a medical doctor.”

TRUTH: Zahra is not a licensed medical doctor or a medical professional of any kind.

LIE #3: “The budget needs to be reflective of the needs of our community.”

TRUTH: Zahra wasted a million dollars of the people’s money frivolously suing a local blog and its authors, and were it not for the new Council, that bill would still be accumulating. A million dollars would have paid for a fire engine and more than a handful of Parks and Recs, Police, or Firefighter, or Maintenance employees.

LIE #4: “We have a shortage of staff and we need to invest in those areas.”

TRUTH: Zahra had an opportunity to pass a budget with a 1% cut and $1 million dollars to the City Manager to fill staffing concerns. He voted no, not once, but on three different City Council meetings. 

LIE #5: “I would love to see more drug programs and engaging our school district on drug prevention programs.”

TRUTH: Zahra advocated for publicly and voted for on four separate occasions to have weed sold in Fullerton with only a 100 foot buffer zones to schools or homes or churches or parks.

LIE #6: “Supportive housing is crucial, but we need to make sure we are also outreaching and creating transparency.”

TRUTH: 1600 Commonwealth is an affordable housing development and so little transparency and outreach was done that the neighbors protested en masse and killed the deal with Pathways of Hope because of lack of outreach and transparency.

LIE #7: “We need to make sure our parks are maintained and cleaned.”

TRUTH: Zahra voted to give away Union Pacific Park in the heart of his district to a for-profit event planner for weddings.

LIE #8: “I have been one of the most engaged Council members. Everybody knows I’m out there.”

TRUTH: Woodcrest neighborhood mothers and residents have come to one Council meeting after another in the past 2 years complaining about Zahra’s lack of accessibility and lack of engagement with them. But then again, they are not kissing his ass and stroking his giant ego. He works with the Center for Healthy Neighborhoods. Why? Because their director donates to his campaign and their employee Egleth Nuncci is his permanent tag-a-long. No other non-profit or community group gets any engagement from Zahra.

LIE #9: “We also need to expand our ability to do corporate partnerships.”

TRUTH: Zahra strong armed Republic Services, the City’s trash hauler to give his pet project city in a foreign country a trash truck and then promptly took a selfie and credit for saving democracy. That’s not a corporate partner. That is a quid pro quo.

LIE #10: “I have worked with this Council, despite sometimes the hard times and differences we’ve had.”

TRUTH: Zahra only works for and with Zahra. He has no contact with his Council colleagues. So how are you working with this Council, Ahmad?

LIE #11: “Be faithful with my votes.”

TRUTH: Zahra made an impassioned speech about how important voting was in his country of Syria and that the at large Council seat vacated by Jesus Quirk-Silva should be determined in a special election to betray the people and his faith in democracy the very next meeting and appoint the elderly disaster Jan Flory, who in turn voted to appoint him to the Orange County Water District and its healthy stipend, one he took without objection and then donated to his campaign.

LIE #12: “We see so many Councilmembers come and then they make backroom deals.”

TRUTH: See TRUTH #11.

The truth is Ahmad Zahra is nothing more than a serial liar. Things come apart so easily when they are held together by lies. It’s always the ones with dirty hands doing all the finger pointing isn’t it?

The Line Up

(Revised: I missed the Date Qualified column and so missed the fact that Shelby Perea and Rosalia Guillen did not qualify for the ballot. The text of the post is revised to reflect this)

Here’s the list of candidates in Fullerton’s 3rd and 5th District elections in November.

The most notable feature is the number of Spanish surnamed candidates in the 5th, a fact that makes it much easier for the arrested and charged incumbent, Ahmad Zahra, to continue his sanctimonious hypocrisy from the dais.

This is all ya got?

We already know that Tony Castro is an unemployed dead-beat who gives off the aroma of a Zahra plant meant to split the Latino vote. Oscar Valadez seems to be a good Catholic boy with a family, a house, a real a job, and standing in the community – all of which set him apart from the empty suit, Zahra. Valadez’s statement says a lot of popular sounding stuff and he’s a Stanford graduate. Geez, it would be nice to have a councilman who wasn’t a preening, self-absorbed weasel? Oscar has the support of Fred Jung, so that’s another positive indication. Zahra wants to save murals and “assets.” He says he’s lived in Fullerton for 21 years which is probably just another Zahra lie he figures nobody can disprove. Among his other supporters of dubious intelligence, he lists the octogenarian bird-brain Molly McClanahan – which is almost cause for pity.

This is a Boohoo. There’s just no getting around it…

Over in D3 there are 3 candidates. We’ve already been introduced to Shana Charles, whose statement includes “progressive” catch-phrases. Her statement about restoring Fullerton’s “gutted” services means one thing – another swing at a tax increase. Her backers are the Quirk-Silvas, of course. I wonder if she’s ever even bothered to thank the Council for creating a district that she is in and that Jesus Quirk-Silva is not! The second candidate is Arnel Dino. But Dino Arnel sounds way better, so that’s what I’m calling him from now on. Mr. Arnel seems to be a lefty also, which doesn’t bode well. Those who have seen him perform on the Planning Commission are immensely underwhelmed. The final candidate is John Ybarra who seems to have relocated to the 5th District. His campaign statement is concise and rational. It appears to be a somewhat conservative and pragmatic voice. One thing is certain: the other two will never fight for accountability at City Hall.

The final element in this election will be the Independent Expenditure committees. The cops and emergency truck driver unions will back Zahra and most likely Charles – liberals, yes, but public union supporters, uber alles.

Things could be better. Or they might get worse…

Then there’s Fullerton Taxpayers for Reform, an I.E. run by Tony Bushala that evidently has set its sights on Zahra. They have already launched a shot across Zahra’s bow, and are likely to continue the pummeling until Zahra’s attitude improves.