When the Venice Freakshow was forced to close its doors in April after a decade of entertaining crowds on the Boardwalk, its owner blamed the eviction on Snap Inc., the $28 billion company behind the popular mobile app Snapchat, whose presence has expanded dramatically in the beachside community in recent years.
On paper, Snap Inc. has no share in the ownership of the building, and no responsibility for the departure of the Freakshow from the building's ground floor. When ownership of the building changed hands in January, the owner of the Freakshow, Todd Ray, began signing rent checks to a management company called Snapshot Partners LLC, run by Michael Schlesinger, co-founder of Cambra Realty of Beverly Hills.
Despite the similar-sounding names, Snapchat has denied any affiliation to Snapshot.
Nevertheless, Ray told L.A. Weekly in April he believes that Snap was the driving force behind the new landlord's hardball tactics, such as threatening expensive litigation if the Freakshow refused to leave quietly. “This is a classic example of where art, freedom, culture and creativity meets greed, arrogance and just pure deceitfulness," Ray said. Schlesinger did not respond to a call or email requesting comment.
The L.A. Business Journal reported last year that Snapshot is an investment group brought in by Snapchat to acquire the leasehold interest in the building, a report that a spokesman for Snap Inc. says is "inaccurate."
Snap Inc. even emailed the Weekly the following proclamation of innocence in the matter, issued at the time of the Freakshow's departure:
"The Venice Beach Freakshow has been a unique part of what made the Boardwalk special and we are sad to see it move on from that location. We do not own or operate that building and will not be expanding into any of that retail space."
But Venice residents with the group Venice Dogz: An Alliance for the Preservation of Venice have investigated the sale of the building at 909-913 Ocean Front Walk, and they say Snapshot Partners is a "shell company" and that the "real" ownership is difficult to trace. They claim it is part of a strategy by Snapchat to purchase land or gain leasehold interest via what one activist called "flimsy aliases."
Venice Dogz has been monitoring Snapchat's expansion in Venice since January. The group says the continued expansion of Snapchat into Venice is altering the character of the low-rise bohemian beach community to that of a corporate campus.
On a recent tour of the boardwalk in North Venice, Barbara Lonsdale, a member of Venice Dogz, pointed to the opaque windows lining the storefronts of Market Street that house the principal offices of Snap Inc. The area was once a busy hub of restaurants, bars and artists studios, Lonsdale says. Today it is home to a commissary for Snap Inc. employees and secure offices requiring company badges for admittance. Boxy shuttle vans pick up and drop off employees at all hours under the watchful eye of private security guards.
"We call them 'Snap bots,'" Lonsdale says of the guards.
Venice is the location of Snap Inc.'s principal offices, and the address of its corporate headquarters is 63 Market St. But the corporate prospectus states that rather than one centralized headquarters, the company
has "many office buildings that are dispersed throughout the city."
The local activists monitoring the company's dramatic expansion have compiled a list of 23 properties they say Snap Inc. either leases or owns in Venice, as well as several "suspected locations" — as yet unconfirmed — where they say Snap Inc. shuttles drop off and pick up employees. They also have seen employees with Snapchat badges go in and out of the building, as well as security guards standing beside the entrances. A Snapchat spokesperson said that a significant number of the suspected properties on the list were inaccurate.
Venice Dogz staged spirited protests in the neighborhood in March to coincide with Snapchat's initial public stock offering and again in April at the closing of the Freakshow. More recently, the group has shifted its focus to code violations on the issue of residential parking. The group filed a complaint with the California Coastal Commission in March charging Snap with snapping up parking that the commission has set aside specifically for residents.
Parking is notoriously scarce in Venice, and this is not the first time area residents have accused Snapchat of exacerbating the problem. Venice Dogz supplemented its complaint to the Coastal Commission with a slew of angry letters in May, testimony from neighbors that Snapchat employees are taking away parking spaces traditionally reserved for residents.
The Coastal Commission issued the original permit for the Freakshow building back in 1981, mandating that 41 parking spaces in the underground garage "shall be provided on a lease basis to residents of the North Venice area" — a provision the activists say the current owner, whoever it is, is violating.
Laura Booth had been living near the building for 11 years when she went to inquire about renting a parking space in March. "They told me right to my face it was because Snapchat employees were renting all the spaces," she says about her discussion with the lot's managers.
A similar thing happened to Lance Lacy, who lives next door to the garage. Lacy put his name on the waiting list for a parking spot in the garage two years ago, only to be told last year that no parking space would be forthcoming; indeed, that there was no longer a waiting list. Lacy says he grew angry after he noticed a clipboard on the desk of the parking attendant with a Snapchat employee check-in list and a long list of names.
A senior official with the Coastal Commission in L.A. County told L.A. Weekly that the complaints about parking from Venice residents were referred to the enforcement division, which has opened an investigation.
Noaki Schwartz, a spokesperson for the Coastal Commission, says that typically the terms of a permit such as this would remain in effect, and that the agency is checking to see if there have been any amendments that would have changed the requirements.
A phone call to Lincoln Property Company, which manages the garage for Snapshot Partners, was not returned.
A spokesman for Snap Inc. says the company leases only eight stalls in the building, the number allocated to it according to the terms of its sublease with Snapshot Partners. The spokesman says Snap Inc. also offers cash incentives for employees to use buses, trains, bicycles and other alternative means of transportation to commute to work in Venice. It also provides the ubiquitous shuttles to transport employees from commuter lots outside Venice.
Snap Inc. reportedly leased about 300,000 square feet at Santa Monica Business Park, with the option to lease an additional 100,000 square feet there. Snap Inc. has said publicly that it intends to focus its future expansion outside of Venice.
Jenni Hawk, an organizer with Venice Dogz, says the parking situation at the former location of the Freakshow is one of several examples of parking being taken away from Venice residents and from the general public and given to Snap.
Another example is Thornton Lofts, at the corner of Ocean Front Walk and Thornton Avenue, where Snapchat was inspected by the City of L.A. last year. The lofts are zoned as "live/work," but Hawk says they are used purely for office space.
"There is absolutely no living going on here," Hawk wrote of Thornton Lofts in a complaint emailed to the Coastal Commission in March. "In fact, they don’t even use the kitchens in these live/work offices to feed the employees in them because they’re too full of people."
A former Snap Inc. employee told Business Insider last year that mattresses were hauled in in advance of inspection to give the impression that someone was living there when really it was purely office space for Snapchat's growing staff. A Snapchat representative said that the company was in compliance with regulations, and declined to comment further on the matter.
If you like this story, consider signing up for our email newsletters.
SHOW ME HOW
You have successfully signed up for your selected newsletter(s) - please keep an eye on your mailbox, we're movin' in!
Hawk says the group has received additional complaints from residents claiming to have lost their parking to Snap's expansion in Venice, in addition to the locations of Thornton Lofts and the site of the former Freakshow.
Taylor Bazley, field deputy for Councilmember Mike Bonin, said in an email to the Weekly that the councilmember "takes the issues of beach access and public parking extremely seriously given the scarcity in Venice."
Councilmember Bonin's office for now is deferring to the Coastal Commission, which granted the underlying permit at issue.
Snap Inc. has 2,000-plus employees around the world, and more than half of its office space is in L.A. County, with the principal offices in Venice. The company's recent prospectus states, "We intend to hire a significant number of engineering and sales personnel in Venice, California, and surrounding areas."