Developers had hoped to build a large mixed-use complex featuring high-rise… (Anne Cusack, Los Angeles…)
Bunker Hill is showing signs of life. A new 12-acre Civic Park is nearly complete, sloping down to the steps of City Hall in a cascade of stairs and lawns. Down the block, the skeleton of the Broad Museum is rising on Grand Avenue, set to take its place alongside the Museum of Contemporary Art, Walt Disney Concert Hall and the Dorothy Chandler Pavilion.
But at the center of it all, the land set aside for what was to have been downtown L.A.'s transforming development remains untouched. Under the original plan — which backers said would help create a "Champs Elysees" for Los Angeles — a dramatic Frank Gehry-designed complex of high-rise towers, shops, upscale condos and a five-star hotel should have been completed by now. Instead, the space is still used as parking lots.
The Grand Avenue project was born a decade ago amid the real estate boom and the belief that downtown could support high-end retailers and multimillion-dollar housing.
But it's been stalled for years by the recession. And even some of its strongest backers now say it's time to rethink the project given the economic climate. In particular, some doubt downtown L.A. can support the luxury aspirations of the original plan.
"I'm not so sure there's many people who believe that it's a reality today," said L.A. County Supervisor Gloria Molina.
Related Cos., the mega-developer anchoring the project, said revisions are on the way. Bill Witte, president of Related California, said that the firm was working to adjust its plans to better reflect market conditions, and that its "dimensions, scope and scale" could be adjusted. He did not reveal specific details but suggested the new plans would be aimed at getting the project off the ground.
"We still believe we can create some of the highest values downtown....But do I think we have to be a little bit less ambitious? Yes, I would agree with that," Witte said. "The city's and the county's expectation is that they want something with vision and that is doable. I don't think anybody is interested in pie-in-the sky talk."
Though Witte said Related remained committed to the basic outlines of the development, he would not comment on the fate of Gehry's two translucent, glass-curtained towers that promised to alter the downtown skyline.
Under its amended agreement, Related must begin construction by February 2013 — or obtain yet another extension from the board of city and county officials overseeing the project. Related is expected to bring new plans to the board this year.
During the height of the real estate boom, developers unveiled numerous luxury projects, believing the downtown revitalization was so strong that it could support Beverly Hills-level retailers and residences. Most of those projects died, notably a plan to build a 76-story residential tower known as Park Fifth near Pershing Square. Today, Grand Avenue is the last project considered a serious possibility.
The long-stalled project is likely to take a step forward this summer when the Grand Park opens. Related paid about $50 million toward the construction, which was billed as a key public benefit for a development being built on publicly owned land. Residents of downtown, who have long complained that there is not enough open space, are anticipating the park's opening.
The development, which had a total price tag of more than $3 billion, also includes a lot across from MOCA, where Related is planning an apartment tower, and the site of the Broad Museum. Related officials say both projects, as well as the park, will help it secure financing for the central complex along Grand Avenue, between 1st and 2nd Streets. Since the start of the recession the firm has struggled to secure the $1.1 billion in loans needed for that portion of the project.
Under current plans, the central lots would include a boutique hotel, hundreds of luxury condos and acres of retail space for upscale restaurants, shops and art galleries.
Pricing levels at the condos were projected as high as $1,200 per square foot, said Cal Hollis, a real estate consultant who was involved in the planning phase. Under that pricing, a 2,000-square-foot condo would run more than $2 million.
FOR THE RECORD:
An earlier version of this article incorrectly spelled Cal Hollis' name as Hollies.
When Grand Avenue was announced, officials were confident there was a market for homes in that price range, in part because of Gehry's bold design.
Currently, the average price of a new downtown condo in $489 per square foot, according to OnTheMarket, which analyzes real estate values in California.
Witte said he still believes there's great potential for the site and that the emergence of new bars and nightlife in other sections of downtown means there's less pressure on Related to "do it all" at Grand Avenue.
Real estate experts and urban planners were more blunt, however, saying the Grand Avenue plans are outdated and need to be reworked extensively.