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City Is Urged to Buy Building to House LAPD

The structure, co-owned by Magic Johnson, would be used while new headquarters are built.

November 19, 2003|Patrick McGreevy | Times Staff Writer

Los Angeles city officials proposed Tuesday to spend $80 million to buy and renovate a downtown office building co-owned by former basketball star Earvin "Magic" Johnson for use as temporary Police Department headquarters while a replacement for Parker Center is built.

Chief Legislative Analyst Ron Deaton's recommendation was endorsed by two City Council committees as the first step toward entering escrow on the 11-story building at 1149 S. Broadway. The 490,000-square-foot structure is part of the Transamerica complex in South Park that was purchased in May by Johnson's Canyon-Johnson Urban Fund.

The proposal, scheduled for a council vote next week, was recommended after Deaton said Johnson's consortium offered the best deal of several competing plans, agreeing to sell the building for $50.7 million.

"This is the most cost-effective proposal," Deaton said.

Still, some City Hall critics said the deal appeared to be a poor one for taxpayers and smacked of politics because Johnson and partner Kenneth Lombard have been active political supporters of Mayor James K. Hahn and City Council members involved in the deal.

"It's cronyism," said Gordon Murley, president of the Woodland Hills Homeowners Organization.

Real estate experts said it appeared that Johnson's partnership would earn a handsome profit on the sale.

The group paid $100 million in May for a complex that includes the prospective city building as well as a second 11-story office tower, the 32-story Transamerica Center Tower, three parking structures and 5.5 acres of adjacent land.

The entire complex includes 1.4 million square feet of office buildings.

"It's pretty obvious that it would be a pretty good deal for Magic," said Steve Allwright, a veteran real estate broker with Metro Resources.

"The city could have had [it] at a better price if they had bought it directly, but the public sector hardly ever does as well as the private sector at projecting real estate market trends and buying property," said Larry Kosmont, a real estate consultant who has done work for the city.

Allwright said the downtown real estate market "is just taking off like crazy," so it appeared that the city would be paying a fair price for the Broadway building, especially since it includes 1,700 parking spaces in an area where parking is at a premium.

LAPD officials have complained for years that Parker Center is obsolete and unsafe and should be replaced.

The city has proposed a $470-million replacement for the police headquarters near City Hall, to be completed in 2008, but concluded that it would be less expensive and more practical to move employees out of Parker Center during construction.

Rather than lease space for the temporary police headquarters, Deaton said, the city would save $8 million a year by buying the Broadway building for use during construction of a new headquarters and then moving other city agencies into the building when the police vacate it.

The purchase was recommended by the city's Municipal Facilities Committee, which includes Deaton, City Administrative Officer Bill Fujioka and Hahn's chief of staff, Tim McOsker.

Johnson campaigned for Hahn in the 2001 mayoral election. Though critical of the mayor last year for not backing Bernard C. Parks for another term as police chief, Johnson co-chaired Hahn's anti-secession campaign L.A. United last year. Until he moved out of the city recently, Lombard served as Hahn's appointee to the city Department of Water and Power board.

One of the council committees that recommended the purchase Tuesday is headed by Parks, who kicked off his election drive last year from the lobby of the Magic Johnson Theatres and who benefited from campaign appearances by Johnson.

Lombard denied that political influence played any role in the deal. "Absolutely not," he said. "Just like everyone else, we had to compete for this."

Deaton said that if the deal is finalized, police employees could begin moving into the Broadway building early next year.

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