After a protracted legal battle, the Southern California Institute of Architecture lost its bid Tuesday to buy the historic Santa Fe freight depot that houses the cutting-edge school.
Los Angeles County Superior Court Judge Helen I. Bendix rejected SCI-Arc's contention that it had an agreement to buy the nearly century-old concrete building that it leases for classrooms and offices.
Bendix's ruling clears the way for developer Richard Meruelo to buy the building and the 2.5-acre property on Santa Fe Avenue just west of the Los Angeles River.
Meruelo, who has a binding agreement with the property's owner, intends to move ahead with planning for the site and eight adjoining acres that he already owns. Meruelo said he wanted to build a project that would be "urban, dense and bold" at the eastern gateway to downtown Los Angeles.
SCI-Arc has a long-term lease on the 1907 depot, and the school wants to work with Meruelo on plans for the site.
"We will be part of that discussion. We have a lease. We ain't going anywhere," said Eric Owen Moss, director of the architecture school. "We like where we are."
Meruelo said he was not wedded to his previous proposal to construct two 40-story residential towers on parking lots next to the architecture school.
"I frankly would like to set that aside and come back to a drawing board and start with a new canvas," he said. "We just want to come up with something that can be worldwide recognized, that can take the school to the next level."
Meruelo said he had no preconceptions about whether the project would be a high-rise or not. "I'll let the experts design something," he said.
The judge's decision was a big win for the developer, who has seen his profile in Los Angeles rise in recent months after becoming the largest individual contributor in the mayor's race.
Meruelo spent $193,311 on an independent campaign to persuade Republicans to elect Democrat Antonio Villaraigosa as mayor. Meruelo, his wife and other family members contributed an additional $27,000 directly to Villaraigosa.
A Cuban American who divides his time between Los Angeles and Miami, Meruelo said the election of Villaraigosa, a Latino, as mayor of the nation's second-largest city was a source of pride. Meruelo and his family are among the largest owners of downtown Los Angeles real estate.
His aggressive pursuit of properties in the city has drawn increasing attention.
He sparked criticism in April after he bought 23 acres near the Los Angeles River in Glassell Park that the Los Angeles Unified School District and area residents had hoped would be the site of a new high school.
But it was Meruelo's clash with SCI-Arc over its home that first generated controversy and led to the expensive court battle.
On Tuesday, Moss sought to put the best face on the courtroom defeat, noting that the school's move to the site five years ago had helped transform the area.
"SCI-Arc came downtown to do something. We came downtown to participate in the remaking of the city," Moss said.
With $1.5 million in financial assistance from former Mayor Richard Riordan's administration, SCI-Arc was encouraged to move from the Marina del Rey area to a part of downtown plagued by homelessness. The school's presence and a budding arts community have slowly revitalized the area at the foot of a graceful bridge that spans the Los Angeles River.
SCI-Arc, which offers graduate and undergraduate classes, has 450 students, 80 faculty members and 20 staff members.
Moss said he looked forward to taking part in discussions about the property next to the quarter-mile long freight depot.
Councilwoman Jan Perry said she was disappointed by the court decision but expressed confidence that the architecture school would remain at the site in her district.
"I want downtown to be their classroom," she said, adding that SCI-Arc had provided a "cutting-edge dynamic" to the area and calling it "a really major source of ideas, vision, creativity."
Perry said she was keenly interested in the density, height and use of the property owned by Meruelo and his partners.
At the end of a 50-minute decision that she read from the bench, Bendix ruled that SCI-Arc had never entered into a binding agreement to buy the depot property from owner Dynamic Builders Inc.
Rejecting SCI-Arc's arguments, the judge said a May 2004 proposal to buy the property negotiated by Dynamic officials and Ian Robertson, chairman of the school's board, was more "a deal-points document than a contract."
Bendix ruled that SCI-Arc had never paid a $500,000 deposit and hadn't held a required board meeting to approve the transaction. "I did this with a very heavy heart," she said. "This was difficult to do."
After the decision was read, Robertson said he was still digesting the verdict and was uncertain whether the school would appeal. He offered a blunt assessment of the outcome.
"When I signed the agreement with Dynamic, I certainly thought we had purchased the building," he said. "She did not agree with our analysis of the documents or the events."