CERRITOS — Believing two developers are better than one, the City Council has chosen Transpacific Development Co. and General Growth of California to shape the $225-million Towne Center project from a 125-acre, brush-covered plot in the heart of the city.
Selection of the two firms ends months of speculation about the direction of the development, considered by many to be one of the most lucrative in urban Los Angeles and Orange counties.
Transpacific and General Growth were chosen from a list of 30 firms that expressed interest in the project following the council's failure late last year to reach an agreement with Alexander Haagen Co., the city's first choice to guide the development.
"The project is off and running," said Cerritos Mayor Diana Needham. "We are more enthusiastic than ever about the project. This will be a big boon to this city."
Richard Plummer, director of acquisitions for Transpacific, called the project "one of the largest undertakings in Southern California. We are going to build Cerritos what it has been missing--a real downtown, a focal point for the city."
Project Big Enough for 2
Needham said the council selected the two developers because of their extensive experience, size and willingness to work with the city. "And besides, we get the extra edge of having two developers to put this huge project together," she said.
Although no deadline was set, John H. Saunders, the city's director of internal affairs, said the city would move "as quickly as possible" to negotiate an exclusive construction contract, known as a disposition and development agreement, with the two companies. Specifics of the deal--such as how the project's profits will be divided and lease arrangements for the land now owned by the city--will be included in that document.
Council members say the development--which is to include a 400-room luxury hotel and convention facility, a high-fashion shopping mall, a 400- to 500-seat theater and adjoining amphitheater as well as more than 1.3 million square feet for offices in several high-rise buildings--is the last major piece of the city's master plan.
Torrance-based Transpacific will build about 60% of the project, including the hotel, the office buildings, several restaurants and a neighborhood shopping center with a supermarket, a large, convenience drugstore and small shops.
3 or 4 Anchor Stores
At the same time, General Growth will develop the 700,000-square-foot shopping mall, which will be built in phases and may eventually be anchored by three or four major department stores, according to John Bucksbaum Jr., president of West Coast operations for General Growth, headquartered in Des Moines, Iowa. The nearby Los Cerritos Mall has 1.3 million square feet.
Finally, the city plans to spend $10 million to $20 million to build a theater complex northeast of the Civic Center.
Two years ago, the city spent nearly $40 million to purchase the center parcel, the so-called "Golden Triangle," formed by Bloomfield Avenue, 183rd Street and the Artesia Freeway.
Saunders said the city has completed nearly $8.6 million in improvements to streets surrounding the site: Bloomfield and 183rd were widened, landscaped center medians were added, curbs, sidewalks and parkways now ring the parcel and fountains, waterfalls and greenery have been installed at the various center entrances.
The city will spend another $7.8 million to extend Shoemaker Avenue over the Artesia Freeway and build freeway on-ramps and off-ramps to the freeway at Shoemaker.
Once completed, the center is expected to create hundreds of jobs for office and clerical workers and return about $24 million to the city in business-license fees and sales, amusement and room taxes in its first 10 years of operation.
Ground breaking for the hotel, shopping mall and first office building could be early in 1986, Plummer said. A completion date for the entire project has not been determined.
City officials say they are confident they have finally found a pair of developers who can finish the job. The council and the Manhattan Beach-based Haagen spent most of 1984 trying to reach an agreement before they parted company amid reports of personality clashes and broken promises. The two sides could not decide how to divide the riches the development is expected to generate.
As it turned out, the delay proved fortuitous because the economy improved and interest rates started falling. When the council began searching for a new developer in January, more than 30 firms lined up--triple the number that approached the city the first time around.
"Two years ago, a project that size was a difficult undertaking for any firm, even a big one," said Plummer, whose company is building Orange County's tallest office tower, a 16-story, $70-million project in Irvine, and is also developing South Coast Metro Center, about 1.3 million square feet of office space and two hotels.
Two months ago, the council narrowed the list to four finalists. Besides Transpacific and General Growth, the council considered Tutor-Saliba of Sylmar and Tishman West Management Corp. of Orange.
To avoid another failed agreement with a developer, the council this time around was more involved in interviewing the firms.
"The city took a different approach, letting the developers know right up front what we wanted. The council also spent hours visiting various projects to get a firsthand look at developers' work," Saunders said.
Among the trips was a two-day, four-state tour of regional shopping malls developed by General Growth, which has built more than 40 centers from Washington state to Puerto Rico. The firm was one of four finalists 18 months ago when the council opted to go with Haagen. Since then, it has opened an office in Canoga Park.