Grand Avenue Committee Plays Tough with Related?

Question is: two months from now, will Related take a hike? Or might they rather put up an office building instead of a condo/hotel and let the smaller structure at First & Olive be the Ritz? Could they snag Union Bank of California to be the primary tenant? It is one solid financial institution in need of a higher profile.

Let’s suppose that the Related Companies walks away from the deal two months from now. Let’s step back (is there somewhere a Robert Byrd in county government?) and allow ourselves to imagine an eventual outcome that could be far better than Related’s solution for south of First Street, than letting those two county buildings remain as is.

Whether economic times are good or bad, assembling so much land and awarding it to one development entity is a mistake. The present course of events is proving this to be true and it happened during the Reagan recession as well, when Cal Plaza was delayed, bolixed up and never completed. I refer to the entire area that was included in the 1980 Bunker Hill Design Competition. Be it retail, residential or office use, there is only so much space that can be absorbed year by year and this time around we sure ain’t gettin’ nothing so much as MOCA.

In 1988 there came the West Coast Gateway Competition. The site selection for that event was not critically examined. As well, it was THAT certain summer and each of five selected winners was deconstructivist in mode. The grand prize entry failed to catch the imagination of the city but did manage to attract a host of imaginative epithets. The mayor was embarrassed and didn’t want anything more to do with the idea. In 1992 there came the L.A. Millennium Project for South Park; it quickly sank beneath the waves of the recession and riot of that time. Conventional word now has it that Disney Hall has supplanted the Hollywood Sign as the reigning symbol of L.A.

What could better symbolize Los Angeles than Gehry’s quasi-magnum opus? If only we were to be allowed to imagine. Still there remain the two county buildings, seismically unfit, saddled with asbestos, with all the soul and spirit of a pair of wet mops.

If, perhaps, Related were to take a hike, maybe someone in county government will say let’s stop, step back a moment and allow ourselves a larger perspective. I feel that somewhere along that axis between city hall and the backdrop of the department of water and power, that we need a PLACE (rather than a building) that would make the world sit up and really take notice of Los Angeles. Such a place needs to be held and defined by a multiplicity of uses and activities.

Eli Broad had the vision (and cash) to say let’s start over with the high school of the performing arts. Thanks be to the gods - his willingness to go out on a limb is paying off. There is the walled-off and gated plaza at the cathedral which needs to be opened up, made more accessible to Temple Street. People have said let’s bridge across and cover the freeway.

Gee, I wonder if Eli would seed 100K to MOCA to conduct a multi-stage competition. All donations would be tax deductible. The program for such an event could include a pedestrian bridge over the freeway, opening up the cathedral plaza, reprogramming all of the land now used for the county buildings AND all of the land covered by Gehry’s design for Related.

End result is that we have two axes: the mall and Olive Street. One is anchored by city hall and the other by the signature tower of the high school. Could a symbolic element be located at the crossing of these two axes?

How might this symbol appear at dawn, at dusk or at midnight? Put on Stravinsky’s Rite of Spring and listen! We have only to imagine.

It’s really just a statement by the committee. In their next meeting they may agree to the extension. It also just puts more pressure on Related to get the financing in order.

But they can’t really “force” Related to keep to the current timetable if the financing is really not there yet. If Related does not have all the construction loans lined up then they can’t start contruction no matter what the committee says.

And County Supervisor Antonivich’s statement that they should now have a smaller project is just stupid as are many of his statements. The Project as already been agreed to and it is a long term project so the current real estate and financial situation does not really matter. By the time this project is completed, the real estate market will prbably growing again.

“By the time this project is completed, the real estate market will prbably growing again.”

Excuse me? You’ve unintentionally suggested that all three phases of The Grand could be built out in a negative real estate era. (And I do mean era.)

Do you know something about Bunker Hill that the rest of the world doesn’t? The three years preceding the economic crash of 1929 was a time of acute real estate contraction.

If this DLANC squabling were to continue, it just might trip the national recession right into a depression I tell you. In that regard, I’m voting for No We Can’t.

From Wednesday’s Christian Science Monitor:

“The entire market for asset-backed securities is dead in the water,” says Mr. Malmgren. They are only sold on money markets at huge discounts, ranging from 15 cents off the dollar of face value to 75 cents off. “This problem will not go away quickly. It affects every human being.” For individuals, getting a mortgage or car loan has become difficult. Those struggling to make credit-card payments or reaching their credit limit face stiffer penalties and less flexibility from credit-card companies. Retirees may also be affected as thousands of pension funds around the world, private or government, have found their assets shrinking from toxic holdings of asset-based securities.

By now, the list of financial institutions hit by the freeze is long. Companies in the United States writing off massive losses include Citibank, Merrill Lynch, and Morgan Stanley. Joining them abroad are regional banks in Germany, Chinese banks and companies, and Taiwanese banks, among others.

So far, various financial institutions in the US and abroad have announced some $120 billion in losses from these investments. But the big question in the financial community is: Who holds the remaining $280 billion of toxic waste? (The $400 billion estimate minus the $120 billion in announced losses.)

Those holding it are reluctant to admit it, says David Wyss, chief economist at Standard & Poor’s in New York “The only people who tell us are the people who have to tell us,” he says. “We don’t know where the rest of it is.”

They better get some more investment from Abu Dhabi. A whole LOT more. Ask them to send it in gold bullion while you’re at it, Bill. Perhaps the Pentagon could lend a C5-A transport.

If the deal falls through, how to/who picks up the pieces? If a lengthy real estate retraction lies ahead of us, will (or can) the Downtown ball keep rolling with new ideas and energy, or will it simply deflate, like the early 90s recession?

To hell with the “suits”. Get the students and artists involved. Whatever, something really exciting is needed.

That said…..

I’ve completely given up on this project, and I suggest the rest of you do the same. This project is clearly dead.

“The three years preceding the economic crash of 1929 was a time of acute real estate contraction.”

UT, I’m no economist, but I think it is a bit over the top to characterize the present econonic environment as comparable to that prior to the Great Depression. Frankly, I think it is irresponsible.

Edit: make that an acute contraction in the value of real estate, particularly residential.

Bill Witte and the Related group will be presenting an update on the Grand Avenue Project and the park at the July DLANC meeting on Tuesday July 8th at the Los Angeles Theatre 615 S. Broadway.

Eric: I understand that, but Related has yet to aquire a construction loan, and they will likely not do so this year.

Mr. Kennedy is right, it is not comparable to the Great Depression since it will be the GREATEST Depression.

Why is anyone waisting time listening to Related in the first place. It is not up to them to build it. It is up to the SWF, pension or “hedge” fund that will pay for it. And the only way they will do that is if Gehry turns that pretty tower into an oil derrick. Commodities are the new girl in town and everything else is going to pound sand.

Money Bags: “Related, let me get this straight you want me to sink 1 billion into your little erector set garage, wait around for a couple of years and pray that you can sell condos for 10-20x income? Where is that retail price condo-owner gonna get the money from? Me, you say? Oh that’s right I’m the only one left with any money. GREAT! Then I have to wait around a few MORE years for him to pay me back over half his monthly earnings? I think I’ll stick to buying up all the oil and food he needs to live on. I get rich quicker when I eliminate the middlemen.

Related:”Yeah, I was kinda hoping you still wanted a middleman to keep your hands clean.”

Money Bags:” Are you kidding me, with everything soooo expensive now, I gotta cut cost where I can.”