Changing tradition

By Abby Sewell

March 20, 2011 12 AM PT

The marble walkway leading into the California Club echoes with the ghostly footsteps of land barons, railroad tycoons and political kingmakers.

So does the ostentatious front lobby of the Jonathan Club nearby.

Private business clubs once were centers of power in downtown Los Angeles. You might have found rail magnate Henry E. Huntington playing dominoes and plotting his next expansion beneath the high, oak-paneled walls. Or William May Garland, the real estate developer, scheming to bring the 1932 Summer Olympics to Los Angeles. Or an early-1960s meeting of the Committee of 25, a group of powerful businessmen that was considered a shadow city government at the time.

As late as the mid-1980s, you would not find a single black or female member at some of these exclusive clubs.

Yvonne Burke, California’s first African American congresswoman, who later served five terms on the Los Angeles County Board of Supervisors, recalls going to civic meetings at the clubs where “they would take me around the back or to the side door to let me in.”

Today the clubs have a more diverse membership. But it’s also been decades since they served as the backrooms for city politics. And unlike many mayors of earlier days, Antonio Villaraigosa is not a member of any of them -- and some wonder whether these clubs even have a future.

Easing the rules

Just last month, the Regency Club in Westwood, owned by billionaire David Murdock, announced that it would close its doors April 30, citing high costs and declining membership.

Hoping to avoid the same fate, the elite private clubs that remain downtown -- the California Club, the Jonathan Club and Los Angeles Athletic Club, all formed in the late 19th century, and the much younger City Club on Bunker Hill -- have gradually eased their clubby rules to ensure that their facilities remain in use.

These days you’re more likely to find business lunches, political and social fundraising events and meetings of the Rotary Club or groups of attorneys and corporate directors. Or a giggling gaggle of bridesmaids, tipsy after a wedding.

“What are you going to do -- are you going to have the tradition or are you going to change? This is a real problem for clubs,” said Crystal Thomas, executive director of the California State Club Assn.

The institutions have reached out to the younger generation (with varying degrees of success) through sliding membership-fee scales, mentoring arrangements and social events designed to appeal to the under-35 set -- such as a recent tequila-tasting night at the California Club. They have even made the concession to modernity of allowing business-casual dress on the premises.

But their membership base still tends to be slanted heavily to the 55-and-up crowd.

The Athletic Club has most aggressively targeted the young loft-dwelling entrepreneurs who populate the revitalized downtown. It seems to be gaining traction with up-and-comers attracted by the combination of gym facilities and “Mad Men”-style retro chic at a relatively affordable price tag.

Josh Gray-Emmer, 32, is a downtown resident who owns marketing and branding firm AP Consulting and is preparing to open a vodka bar in the Haas Building at 217 W. 7th St. He belongs to the Athletic Club but never considered the pricier and more buttoned-up California and Jonathan clubs.

“I’m not the son of incredibly wealthy parents who has a societal need to join these things,” Gray-Emmer said.

But the clubs don’t survive on membership alone. Increasingly, they also depend on income from renting out their facilities for events such as weddings, awards ceremonies and business conventions -- even as film sets, in the case of the Athletic Club.

Some are more stringent than others in requiring events to be member-sponsored. But in all cases, the functions have become a major source of revenue, and one that took a nasty hit in the recession.

In some cases, the clubs also serve as hotels. At the Los Angeles Athletic Club, the top three floors of the building used to serve as members-only apartments, housing early Hollywood stars such as Charlie Chaplin and Rudolph Valentino. Now the newly remodeled rooms rent to the public for $170 and up a night. (The California and Jonathan clubs rent rooms as well, although only to members and their guests.)

All the clubs will eventually go this route to survive, said Christopher Leinberger, a redevelopment expert with the Brookings Institution who belonged to the Jonathan Club in Los Angeles for several years in the 1980s. “The problem when you have a franchise based on a memory is that people die,” he said.

Power center

The clubs still hold their traditional niche with the old-school downtown business community of developers, attorneys, mortgage brokers and investment bankers.

“I can’t imagine a major business in downtown Los Angeles that would not have members in the California Club,” said Jim Thomas, president and chief executive of Thomas Properties Group, who is a member of the California Club and a founder of the City Club.

But times have changed since the days when someone coined an adage that club members still like to quote: “The people who run Los Angeles belong to the Jonathan Club. The people who own Los Angeles belong to the California Club.”

Former Mayor Richard J. Riordan, a longtime member of the California Club, said he remembers the days when members of the Chandler family, who owned The Times, roamed the halls, and it took a knockdown fight to get Harold Brown, the Jewish president of the California Institute of Technology, admitted in the late 1970s.

“The California Club, when I joined it in the early ‘60s, it represented essentially all the old-time leaders of Los Angeles,” Riordan said.

“As the new generations came on, it wasn’t that important for them to be part of the club.”

Many of Los Angeles’ major businesses are no longer downtown. The power base of the city has dispersed and the city’s leadership has diversified -- and not everyone has forgotten the legacy of discrimination at the California and Jonathan clubs, which didn’t admit women and African Americans until the 1980s.

And by virtue of their location, the downtown clubs have made limited headway with the Westside entertainment industry crowd -- although the Jonathan Club’s beach facility in Santa Monica draws some of the Hollywood set. The Athletic Club owns the California Yacht Club in Marina del Rey.

And even healthy private clubs have been challenged by the effects of the economic downturn, which hit their core constituency of business executives particularly hard.

Financial squeeze

Initiation fees for the downtown Los Angeles clubs range from a $500 standard membership at the Los Angeles Athletic Club to a reported $30,000 for full access to the Jonathan Club’s downtown and beach facilities for those who can make it through the intensive screening process to join. On top of that, there are membership dues as high as several hundred dollars a month.

With the subprime mortgage crisis of 2007 and financial market crash of 2008, even the rich cut luxury items from their budgets. And companies concerned about their public image avoided renting out club rooms for the lavish functions they might have held in the past.

The California Club reported a net loss of nearly $1.4 million for 2009 on its most recent annual financial statement (the nonprofit social club’s statements to the IRS are public), after smaller losses in the two previous years.

Club spokesman Clifford Miller, managing director of Shamrock Holdings Inc., the investment firm founded by the late Roy E. Disney, attributed the 2009 deficit to an economy-driven decline in major events hosted at the club. After a strong Christmas season, he said, the club was back to fiscal health in 2010.

The Jonathan Club’s income exceeded expenses through 2010, based on its financial statements. But it saw a $3-million drop in revenue from 2009 to 2010 and had to cut management staff to balance the loss, General Manager Matthew Allnatt said.

The City Club lost 15% of its membership in 2008 and 2009, according to General Manager Larry Ahlquist. The privately held club, owned by Texas-based ClubCorp, does not release its financials. The Los Angeles Athletic Club, locally owned by the Hathaway family, which also owns a chain of self-storage facilities called Storage West, also does not disclose its revenue and income.

Still a refuge

The clubs may not be the center of civic and political gravity they once were. But at least some people don’t think they’re going anywhere.

Dan Rosenfeld, a senior aide to Los Angeles County Supervisor Mark Ridley-Thomas, said he likes to take refuge in the California Club between meetings, sink into an armchair in a quiet room, close his eyes and think, or not think. He likes the legacy embedded in the club’s walls.

“I admire its history and its presence. It’s a thread that runs through the history of Los Angeles, and many of our threads are imperfect,” he said. “These clubs will change and adapt, and I think these clubs will continue.”

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Elite clubs at a glance

California Club

Address: 538 S. Flower St.

Founded: 1887

Current membership: About 1,100

Peak membership: 1,275 with a waiting list

Prominent members, past and present: Gaylord Wilshire, William Mulholland, Norman Chandler, Richard J. Riordan

Jonathan Club

Address: 545 S. Figueroa St.

Founded: 1895