Cen­tury City land for sale

JMB Re­alty drops plans to build an of­fice sky­scraper on Av­enue of the Stars. In­stead, the 5.5-acre prop­erty is likely to be de­vel­oped into con­dos.

Los Angeles Times - - REAL ESTATE - By Roger Vin­cent roger.vin­cent@la­times.com Twit­ter: @rogervin­cent

Cen­tury City land­lord JMB Re­alty Corp. has dropped plans to de­velop an of­fice sky­scraper on Av­enue of the Stars and in­stead has put the land up for sale.

The prop­erty is ex­pected to be de­vel­oped into con­do­mini­ums in­stead of of­fices as in­vest­ment in high-end Los An­ge­les County con­dos es­ca­lates. Most of the big­gest land sales in the last few years have in­volved sites in­tended for high­den­sity res­i­den­tial devel­op­ment.

JMB al­ready has city ap­proval to build 483 res­i­den­tial units on the va­cant lot at 1950 Av­enue of the Stars, near the Hy­att Re­gency Cen­tury Plaza Ho­tel, but pulled the plug on that pro­posal af­ter the hous­ing mar­ket crash.

JMB switched its plans for the site to a 37story of­fice tower, but now luxury res­i­den­tial sales have roared back and de­vel­op­ers are com­pet­ing for the best condo sites. A new owner could quickly res­ur­rect JMB’s plans for the condo devel­op­ment. In­quiries about ac­quir­ing the prop­erty for hous­ing prompted JMB to put it on the mar­ket, a com­pany rep­re­sen­ta­tive said.

“Af­ter re­ceiv­ing sev­eral un­so­licited of­fers on the res­i­den­tial, it be­came ap­par­ent that thiswas a unique op­por­tu­nity we could not ig­nore,” JMB spokes woman Marie Gar­vey said.

A new owner also could choose to pur­sue of­fice devel­op­ment on the site — Cen­tury City is one of the re­gion’s strong­est of­fice mar­kets — but the big sums paid lately for Los An­ge­les area land have mostly in­volved po­ten­tial res­i­den­tial projects.

Last year, Chi­nese de­vel­oper Wanda Group paid the equiv­a­lent for $1.7 mil­lion a unit for land in Bev­erly Hills where a 235-unit con­do­minium project has been ap­proved. That’s a sub­stan­tial in­crease from the equiv­a­lent of $878,000 a unit that New York de­vel­oper Re­lated Cos. paid in 2005 for the site where it built the Cen­tury, a luxury condo tower next to the Cen­tury Plaza ho­tel. Units in the Cen­tury have sold for as much as $3,000 a square foot.

No price has been set JMB’s 5.5-acre prop­erty. Open­ing bids are due July 10, at which point fi­nal com­pe­ti­tion among the top bid­ders will begin, said real es­tate bro­ker Lau­rie Lustig-Bower of CBRE Group Inc.

Po­ten­tial buy­ers from21 coun­tries have sur­faced, she said. Among them are Asian con­glom­er­ates seek­ing to part­ner with U.S. de­vel­op­ers and large over­seas de­vel­op­ers.

The lot, once part of 20th Cen­tury Fox’s stu­dio backlot, is now in the mid­dle of pros­per­ous Cen­tury City, where sev­eral of L.A.’s best and new­est of­fice tow­ers stand. Cen­tury City also has hun­dreds of con­do­mini­ums and an up­scale out­door shop­ping cen­ter op­er­ated by West­field that is now un­der­go­ing $800 mil­lion­worth of im­prove­ments. A sta­tion for a planned sub­way line could open on Av­enue of the Stars within a decade.

Work is also un­der­way on a long-de­layed $300-mil­lion apart­ment build­ing next to the Santa Mon­ica Boule­vard en­trance to Cen­tury City, across the street fromthe ex­clu­sive Los An­ge­les Coun­try Club. The build­ing’s 283 units may end up be­ing sold as con­dos in­stead of rented, ac­cord­ing to de­vel­oper Cres­cent Heights.

If the buy­ers of JMB’s site fol­low the blue­print ap­proved by the city, they would build 483 units in three build­ings: two 47-story tow­ers plus a 12story tower that where the units would have loft­style open floor plans.

The­of­fice tower JMB also planned for the site has been held up by a law­suit by from op­po­nents in­clud­ing ri­val Cen­tury City of­fice owner JP Mor­gan Chase that con­tends the 37-story of­fice tower would be too dense a devel­op­ment for the site and cre­ate traf­fic con­ges­tion.

Cen­tury City of­fice real es­tate bro­ker Gary Weiss of L.A. Re­alty Part­ners said that the neigh­bor­hood could eas­ily ab­sorb an­other pres­ti­gious of­fice build­ing, but that the high­est re­turn for in­vestors could come from the hot res­i­den­tial mar­ket. Get­ting into the game would be ex­pen­sive, how­ever, re­quir­ing many mil­lions of dol­lars to buy the land and then build con­dos in the hope that the de­mand for them will still be there a fewyears later.

“It’s not for the faint of heart,” Weiss said.

Pete Thomas

THE CEN­TURY CITY SKY­LINE, where sev­eral of L.A.’s best and new­est of­fice tow­ers stand, is seen in the fore­ground in 2008.

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