by Garth Meyer
The closed Redondo Beach power plant may be a step closer to a change of ownership as the previous owners have announced the formation of a plan to “dispose of” the site, and the city council voted to negotiate with them for potential purchase of the land.
Much of this depends first on the resolution of a bankruptcy proceeding for current part-owners 9300 Wilshire, LLC, led by Leo Pustilnikov.
On Tuesday night, April 23, Redondo Beach City Attorney Mike Webb read a statement after a closed city council session, quoting AES that it “plans to submit a straightforward and confirmable plan that will dispose of the former power plant site in Redondo Beach. AES will be able to submit its plan on August 21, 2024 or possibly earlier.”
The city attorney continued.
“In light of these imminent developments, the city council directs staff to move forward expeditiously to negotiate with AES for the potential acquisition of the power plant site, should AES regain possession of the property through foreclosure, bankruptcy proceedings or otherwise.”
The news comes after the plant was formally shut down by the State of California Dec. 31.
“I think it’s a prudent action to prepare for however that bankruptcy trial ends up,” said Mayor Jim Light.
“I don’t think (the latest) is surprising, but I think it shows direction,” said City Councilman Todd Loewenstein, who represents the district where the plant is.
Pustilnikov’s 9300 Wilshire, LLC, filed for bankruptcy last February, when $28 million in unpaid payments were due to AES. Pustilnikov initially described the matter as a “true-up over accounting.”
He and 11 other partners bought the AES site for $41 million in 2020, plus an additional $9 million for adjacent properties and $15 million subject to contingencies. Once the 51-acre site sold, AES leased it back from the new owners for the remainder of time that the state of California kept the plant on standby.
9300 Wilshire holds 21 percent ownership, Ed Flores 20 percent, and 1112 Investment Co., LLC, (Ely Dromy) 18 percent.
The city has a total of $15 million in state funds set aside for purchase of the land, secured by State Senator Ben Allen and State Assemblyman Al Muratsuchi.
Depending on how the bankruptcy concludes, the city could aim to put together enough money to buy the 51 acres, for what residents have hoped could become a full park, or perhaps with some development.
“If someone else owns the land, then it is a negotiation,” Mayor Light said. “The city doesn’t get to dictate that.”
If the AES plan to offer it for sale again comes to be, when the plant might be torn down is an open question.
“I don’t think anybody can predict the timeframe with any certainty,” Loewenstein said.
Efforts to reach AES and Pustilnikov for comment were unsuccessful before deadline. ER
