South Gate OKs Sale of Ex-GM Plant : Facility Would Be Demolished to Create an Industrial Park
South Gate officials have approved a plan to sell the former General Motors assembly plant in that city for $12 million, then demolish the 49-year-old landmark and develop an industrial park on the site.
The tentative sale to two developers, approved at a meeting late Wednesday, would close Jan. 31 if approved by GM officials. However, it is uncertain whether the auto maker will agree to accept a price far below what it originally sought.
Would-be developers of the 88-acre GM site are Goldrich & Kest of Culver City and Sheldon Appel Co. of Santa Monica. The two firms are jointly developing the former Long Beach General Hospital site to create a three-phase Long Beach-Signal Hill business center.
Under the proposed South Gate contract, the two firms would sell up to 18 acres of the GM site to the East Los Angeles Community Union, known as Telacu, for minority-owned industrial development, City Attorney Bruce Boogaard said.
Closed in March, 1982
Officials at Goldrich & Kest, Sheldon Appel and Telacu could not be reached for comment about the project Thursday.
The giant auto maker assembled Chevrolet Chevettes and Pontiac T-1000s at the South Gate plant before closing it permanently amid a sales slump in March, 1982, at a cost of 4,300 jobs. The closure was a blow to the city’s economy from which it has not recovered.
The city made numerous attempts to interest GM in reopening the plant, but the company has said it is no longer economical for it to assemble cars on the West Coast--partly because of increased sales of imported cars in the West.
Initially, GM tried unsuccessfully to sell the plant for $32 million. Last August, GM offered to sell the plant to the city at the bargain price of $15 million--if South Gate could in turn find a buyer and close the sale before the end of the year. City officials, however, were not able to meet that deadline and/or find a buyer at that price.
Thus, GM must decide whether to accept what city officials called the best deal they could get.
The city held discussions with six potential developers, two of whom wanted to use the land as a warehouse, which city officials objected to because no jobs would be created, Boogaard said.
Opened in 1936
The GM plant on Tweedy Boulevard was opened in 1936, the company’s first assembly facility west of the Mississippi. Except for a stint making Army tanks in World World II, it cranked out Buicks, Oldsmobiles and Pontiacs almost without interruption until the energy crisis of the 1970s.
GM spokesman Darwin Allen said company officials are reviewing the proposed sale, which calls for GM to sell the plant to the city’s Redevelopment Agency for $7 million--far below the $15 million that it had said it would accept, with the agency in turn reselling the land to the two developers for $12 million.
The additional $5 million would pay for demolishing the plant, which would be done by GM or a private contractor hired by the agency, Boogaard said.
He said South Gate officials are hoping that GM will undertake the state-required environmental cleanup of the plant that would involve removing underground fuel tanks and cleaning up any potential environmental problems, Chief Administrative Officer Bruce Spragg said.
Plans for the South Gate development also call for a 10-acre shopping center, with the city donating six acres of land along Santa Fe Avenue and Alameda Street, Boogaard said.
The $80-million project would have 1.5 million square feet of industrial facilities, producing 2,000 to 4,000 jobs, Boogaard said.
