“Then it suddenly occurred to me that, in all the world, there neither was nor would ever be another place like this City of the Angels. Here the American people were erupting, like lava from a volcano; here, indeed, was the place for me – a ringside seat at the circus.” — Carey McWilliams
Pasadena Star-News
May 16, 2005
Between bites of pasta, Rick Caruso devoured information about Arcadia.
He already knew about founder Lucky Baldwin, about his various wives and lavish properties, and about obscurities like the car collection at the old Pony Express Museum. Now he wanted to know about churches.
“What's the most popular church in town?” he asked.
Someone told him it was a tie between Church of the Good Shepherd and Church of the Holy Angels. Why did he want to know?
Caruso, who is planning to spend $400 million to build a new mall at the Santa Anita racetrack, was thinking beyond the horizon.
Mary Dougherty, one of his 15 or so lunch guests recently, had just suggested that Caruso should build a hotel on the racetrack property with enough meeting space for large wedding receptions.
He was weighing it, and wanted to know where the city's weddings are generally performed.
“It's viable to look at a hotel,” he said. “There's a lot of space in there ... It may make sense to have it be a second phase.”
Part of Caruso's professed philosophy is that community involvement in the early stages of a project leads to both political goodwill and a better project. When community members take ownership of a development, he believes, they are more likely to use it.
That is what this is about. Caruso has invited these Arcadians to the Grove — the jewel in the Caruso Affiliated Holdings crown, a West L.A. mall which has become both a cultural landmark and an extremely robust profit center — to pick their brains and to listen to what they want.
Caruso — who is mentioned as a possible candidate for L.A. mayor — has ample political gifts. He is charming, self-deprecating, earnest and direct. He can win over a room, and moreover, he can persuade people that he is a vehicle for their aspirations — that if they put their trust in him, he will make their lives better.
Though he is not yet a politician, he has already won an election. In the process, he displayed another important political quality: He does not shrink from a fight.
When General Growth Properties, which owns the Glendale Galleria shopping mall, challenged Caruso's Americana at Brand development in a citywide referendum last year, Caruso fought back vigorously, spending more than $2 million on a successful campaign.
A similar battle could be coming in Arcadia. Westfield Group, which owns the Westfield Santa Anita mall adjacent to the racetrack, has already hired lawyers to try to impede Caruso's project. The day after the Glendale victory, Caruso sent a warning shot across Westfield's bow.
“In Arcadia, they had a wake-up call this morning,” he told the Los Angeles Times. “If they fight us, they'll wind up losing, and all they'll do is burn a lot of bridges.”
Caruso is busy building those bridges, although he hopes he won't need them to win another referendum. In Glendale, he says he personally attended more than 100 community meetings to discuss the project. He plans on doing the same in Arcadia. This is the beginning.
Caruso shook every hand when he walked into the second-floor dining room of La Piazza. He was well-dressed, and taller and thinner than one might expect. He quickly made a joke at his own expense. Pointing to an empty table, he said, “I'll sit over here with all my supporters.”
In fact, it was a friendly room. No one seemed to be opposed to the Caruso project. Many who were getting their first glimpse of the Grove — with its main street feel, complete with a trolley — had grown much more enthusiastic.
“If they could do something like this at Santa Anita, sign me up,” said Sue Meikle, a resident who lives near the track. “The Santa Anita mall lacks life. It lacks energy. This has lots of energy.”
Caruso had questions about Arcadia's historic buildings. He hopes to find something quintessentially Arcadian, which he can preserve by incorporating it into the project.
Beth Costanza, executive director of the Chamber of Commerce, pointed out that Ketchikan, Alaska, has attracted visitors by creating a shrine to a historic bordello.
“That would be an interesting idea,” he said, eyebrows arched, spotting what will become a recurring gag. “I can see the headline: ‘Caruso plans new bordellos!'”
A few minutes later, Caruso got up from the table and addressed the whole group.
“I'm a little nervous,” he said, “because we've got a reporter here, and we've just been talking about opening a bordello.”
Big laugh.
“Lemmo's offered to run it. The Chamber's going to manage it,” he said.
A bigger laugh, especially from the Chamber people.
Rick Lemmo is the company's vice president of community relations. Caruso introduced him as a former stand-up comic — “a failed one.” In this context, he is Caruso's foil.
Lemmo had spent his day escorting the group on a tour of Caruso Affiliated properties. The bus took them to the Promenade at Westlake and the Commons at Calabasas, two 1990s projects that show early traces of the design features that worked well at the Grove — fountains, ornate spires and bell towers, and grass lawns where children can play.
“I hear Lemmo was on the bus with the microphone,” Caruso said. “So you've been through enough.”
All of this worked very well, and the group was now ready for Caruso to launch into his earnest pitch which he does with the ease of an old professional who has given this speech so often he could do it backward.
“We're very proud of what we've built,” he said. “This property broke all the rules. People told us, ‘You’re nuts. You’re wasting money building fountains.’ ... But our properties are not designed to be shopping centers. It sounds corny, but the basic premise what really drives us is what would make me and my family want to go somewhere. I want to be able to shop, but I also want to go somewhere and be there for no other reason than to sit and watch the day go by.”
Caruso’s father, Hank, made a fortune on a string of auto dealerships, then founded Dollar Rent A Car. Caruso grew up in L.A., went to USC and Pepperdine Law School, and began his professional life as an attorney. When the law firm collapsed, Caruso found himself unemployed.
He was 27, newly married, with a longing to get involved in real estate.
“My wife said, ‘If you love real estate, then that's what you should do,’” Caruso said.
He began his career buying land near airports and leasing it to rental car companies, including his father's firm. He then moved into developing smaller retail centers, the first of which opened in 1992. With every successful project, he has grown more ambitious. Over the past five years, Caruso’s revenues have grown at an annual clip of 23 percent, and the company now claims the largest retail development program in the nation: six projects all going at once, for a total investment of $1 billion.
Caruso's claim that this cascade of success is guided by the lodestar of his own family’s preferences may indeed come off as overly sentimental, or hokey, or flatly implausible. But putting business in family terms does seem to be a genuine habit of mind.
He spoke of the kick his young daughter got out of petting the horses at Santa Anita, and said it inspired him to find ways to bring the track experience closer to families.
At question time, comments were cordial, even deferential. Finally Kevin Tomkins, the president of the Rancho Santa Anita Residents’ Association, said what everybody else seemed to be thinking: “If you can do in Arcadia what you've done here, then I think most of the people in this room would be pretty happy with that.”
Caruso promised to go one better. The Grove, he said, was hemmed in by the size of the lot — 18 acres. The 85 acres available at Santa Anita would be a bigger canvas. Company officials have promised to do “incredibly exciting” things with the open space, though they have yet to reveal architectural drawings.
“Every project we do has to be better than the last,” Caruso said, in an interview. “I think it’s going to be a spectacular project.”
Caruso shook everyone’s hand as they left La Piazza.
To Mary Dougherty — who, it is fair to say, is a woman of a certain age — he said, “We're going to get you involved in that bordello plan.”
She beamed.
“I'm not too sure about your marketing strategy,” she said, “but OK!”
If it ever comes down to it, Westfield appears to have lost Mary Dougherty’s vote.