Caltrans conducted annual safety inspections at the site of the 10 Freeway fire over the last 15 years and had not issued any warnings about the flammable materials stacked throughout the property, according to tenants who claim they have become scapegoats for the disaster.

The most recent inspection took place Oct. 6, roughly a month before a suspected arsonist turned the lot into an inferno that shut down one of the busiest freeways in the country.

A Caltrans spokesperson confirmed the frequency of the inspections, but was unable to provide information about the results or a copy of the latest report. A California Public Records Act request submitted by the Southern California News Group is still pending.

“Caltrans staff inspect all airspace lease sites at least annually to check for potential safety hazards and lease violations,” said Eric Menjivar, a spokesperson for Caltrans District 7. “Staff also monitor what is placed or stored on site by the tenant. If deficiencies are noted, Caltrans staff notifies the tenant for remedy.”

Though tenants say otherwise, it’s unclear if such a notice was ever issued to Apex Development, the Calabasas company that leased the roughly 48,000-square-foot space beneath the 10 Freeway where the fire originated. Apex rented the land through a state-run program that leases “airspaces” beneath bridges and freeways as a revenue source for mass transportation projects.

No major issues raised

Rudy Serafin, the owner of Serafin Distribution, one of a dozen companies subleasing from Apex, said someone from Caltrans came by around May each year and would make small requests, such as asking Serafin to move a pallet off of a sewer drain. But the employee never raised any issues with the types of materials being stored or their proximity to the columns supporting the freeway above, according to Serafin.

The employee didn’t contact Apex when he needed access or assistance, he went directly to the company’s tenants, Serafin said.

“They never told us nothing,” Serafin said.

Caltrans alleged in September court filings attempting to evict Apex that the company illegally subleased the property in violation of its lease. Following the fire, Gov. Gavin Newsom placed the blame for the destructive conditions on Apex, describing the company and its owner, Ahmad Anthony Nowaid, without identifying either, as “bad actors.”

“This guy and this organization, whoever the members of that particular organization are, have been bad actors,” he said. “They stopped paying their rent, they’re out of compliance. … They have been subleasing the site to at least five, maybe as many as six, tenants without authorization from Caltrans, without authorization from our federal partners.”

Newsom and state legislators have called for a review of the airspace leasing program in light of the fire.

‘Nothing was done in secrecy’

Mainak D’Attaray, an attorney representing Apex, said Caltrans never raised concerns about the wood pallets, hand sanitizer and other materials stockpiled on the site over the last decade and a half. The agency’s inspectors knew the site was subleased and interacted directly with the businesses renting from Apex during the inspections, he said.

“You can see from just driving by what the contents of the site are,” D’Attaray said. “Nothing was hidden, nothing was done in secrecy. Everything was done with the blessing and sanction of the fire marshal and the state.”

Images obtained from Google Street View — dating back to 2009, a year after Apex obtained its lease — show massive stacks of wood pallets, cardboard and other materials every year since. The lease agreement for the property allows for parking of operable vehicles and open storage, and specifically prohibits the storage of “flammable materials.”

The state’s tacit approval through approved inspections over the last 15 years authorized the company to sublease the site and to store the materials that it did, D’Attaray said.

“They did annual inspections and had no issues until something happened,” he said. “It just seems like a convenient political scapegoat for their failure.”

Homeless ‘a constant, recurring issue’

D’Attaray and tenants on the site believe the fire was likely set by someone from one of the nearby homeless encampments. Los Angeles Mayor Karen Bass urged residents not to jump to such a conclusion during a news conference earlier this week.

“There were homeless encampments all along the fence line there, that’s an issue no one wants to talk about,” D’Attaray said. “We called L.A. County Fire many times in the past. This was a constant, recurring issue in that industrial area where the unhoused unfortunately happened to end up.”

The attorney alleges California and Los Angeles officials are pointing the finger at Apex instead of acknowledging that they have not done enough to address the homeless situation.

Continuing legal dispute

Caltrans and Apex have been locked in a legal dispute for months. Caltrans alleges the company hasn’t paid rent in at least a year and owes more than $600,000 for the five properties it controls through the state’s airspace program. The missing payments may stretch as far back as 2020.

Menjivar, Caltrans District 7’s spokesperson, did not confirm the date but said the state, which is suing to evict Apex, could only seek a limited amount of past-due rent. The five “unlawful detainer” lawsuits filed against Apex, Nowaid and his other companies, demand rent from September 2022 until the end of August 2023.

“An unlawful detainer allows only one year’s worth of back rent from the filing date, but a landlord may pursue a breach of contract action after the tenant’s removal from the property to collect rent due beyond the one-year period,” Menjivar said.

Menjivar said the department sought the evictions because Apex refused to leave voluntarily.

D’Attaray, the attorney for Apex, declined to answer questions about the alleged missing rent due to the pending litigation.

Serafin and other tenants reportedly stopped paying Apex after receiving warnings and, eventually, the eviction notice from the state. The roughly 12 businesses crammed on the site beneath the 10 Freeway paid an estimated $23,000 a month to Apex, though the company leased the property from Caltrans for $6,500.

Apex alleges the “emboldened” tenants have barred the company from the property since at least October and it did not have control at the time of the fire. “We didn’t have access for over a month and a half,” D’Attaray said.

Serafin previously alleged Nowaid, Apex’s owner, sent a group of men to physically force him and others off the property and then held their merchandise hostage until the companies began paying again. The group, however, rallied together to cut off payments again in November after receiving the court summons for the eviction cases.

The fire happened roughly a week-and-a-half later, Serafin said.

Apex initially sued Caltrans back in June, alleging the state had interfered with its business by telling the tenants to stop paying it. The lawsuit claims the company made $139,899 in improvements to the airspaces it leased and lists upgrades such $23,885 in paving and $23,000 worth of “cleaning around the property” to address “debris, weeds, illegal trash and transient waste.”

The lease agreements with Apex, however, state that the company is responsible for such costs. That case and the eviction lawsuits are all still pending.

D’Attaray alleges Caltrans’ eviction came after the two sides could not agree on terms for a new lease. Apex’s lease with Caltrans expired in 2015 and transitioned to a month-to-month agreement at the time.


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