Bankrupt LA Project Heads Toward $500M+ Sale
The unfinished $1.2 billion property may at last resume construction.
The City of Los Angeles has withdrawn its objection to the bankruptcy sale of the stalled Oceanwide Plaza mixed-use project encompassing three unfinished and largely vacant towers in the downtown area.
China-based Oceanwide Holdings kicked off the $1.2 billion development in 2015, but the company lacked sufficient capital to continue construction by 2019. The initial vision consisted of 504 condominium units, as well as hospitality, retail and restaurant spaces.
KPC Group and Lendlease were set to acquire the property for $517 million following an anticipated confirmation order by a federal judge. The duo may also invest $850 million to complete construction of the three towers. Additionally, KPC would clean the graffiti that has covered the property following the halt in development.
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Occupying an entire city block at 1101 Flower St., the towers are across the street from the Crypto.com Arena and within walking distance of the Los Angeles Convention Center.
KPC and Lendlease have approximately six months to close the deal; otherwise, a backup buyer may be selected from a pool of firms advancing several condominium projects. One such company is a foreign investment group that reached an agreement with CityView, which was previously negotiating a purchase-and-sale agreement with Oceanwide earlier this year, as reported by The Real Deal.
A bold new acquisition and redevelopment proposal
However, a new docket filing revealed yet another alternative acquisition and redevelopment proposal for the property, submitted by a joint venture between Ironman Entertainment and Flexible Resources, dubbed AA Group, according to the U.S. Bankruptcy Court, Central District of California, Los Angeles Division.
The venture proposed a $500 million acquisition and a $1.2 billion development plan, with a total capitalization of $2 billion. While AA Group’s project mostly aligns with the original Oceanwide vision, the company notably advanced the integration of a 300 MW hyperscale data center to be built in the underground parking garage.
