Watt Project Linked to Replacement Housing : Development: The office project will bring 80 subsidized units to the Central City West planning area, as well as 5,000 workers and a day-care facility.

When the Watt City Center office/retail project is completed just across the Harbor Freeway from downtown Los Angeles in about six years, it will be the daytime home to about 5,000 workers.

Perhaps more important for the estimated 15,000 residents of the Central City West planning area is thatthe controversial twin-tower project will bring 80 low-rent apartment units to the area at a cost of $6.5 million.

This will make it the first project in the area whose approval was linked to replacement low-income housing.

Advocates for low- and moderate-income housing have viewed the $650-million project as a model development for the 314-acre area west of downtown.

“Any developer who builds in Central City West will be strongly urged to do replacement housing when his project is occupied,” said the Rev. Philip Lance, an Episcopal priest and organizer of the 250-member homeowners’ group, United Neighbors of Temple Beaudry & City West.

The mostly Latino residents of the area have an average annual family income of about $12,000, according to Michael Bodaken, a Legal Aid Foundation attorney who represented the community group in negotiations that resulted in the project’s housing element.

“We look upon this commitment to build low-income housing as a model for future projects in Central City West, to avoid the concentration on higher-cost housing that has occurred in other downtown areas,” Bodaken said.

Central City West is a mix of older low- and mid-rise commercial and residential buildings, along with new high-rise office buildings such as the 33-story Arco Center at 1055 W. 7th St. Arco Center opened last spring and is 80% leased.

The boundaries of Central City West are the Hollywood and Harbor freeways, Olympic Boulevard and Witmer and Union streets.

Watt City Center, a project of W&M; Partners Development Corp.--composed of Ray Watt and Kent Merselis--will be built on the 6.48-acre site at 7th and Bixel streets formerly occupied by the Thomas Cadillac and Vicky Thomas Pontiac automobile dealerships. Construction start is scheduled in mid-February.

The two office buildings will be built over a six-year period, with the 29-story, 510,000-square-foot office tower at the southeast corner of 7th and Bixel and a $1-million, 5,000-square-foot day-care center for 50 children on the south side of 8th Street scheduled for completion in the fall of 1991.

A 62-story, 1.1-million-square-foot office tower at the southwestern corner of 7th and Bixel will follow.

The fees for 30% of the children in the day-care center will be subsidized by the developer. The center will be open to the public and also serve workers in the office towers.

Forty of the 80 housing units must be built in the 314-acre Central City West specific plan area, to replace apartment buildings torn down by the Thomas family in 1985, according to Ray Watt, chairman and chief executive officer of Watt Industries.

The other 40 units can be constructed in the specific plan area or within a 3-mile radius of the project.

The housing must be completed by the time the 29-story office tower opens and will be for very-low to low-income residents under guidelines established by the federal Department of Housing and Urban Development, Watt said.

Under HUD guidelines, the ceiling for very-low income is $23,000 a year for a family of four, while low-income is a maximum of $34,000 annually for a family of four, Bodaken said.

Rents are pegged at 25% to 30% of adjusted gross annual income, he said. This means that a family of four earning $12,000 a year would pay $250 to $325 a month rent for an apartment, he said.

“The housing will consist of two- or three-story apartment buildings,” Watt added. “We haven’t decided if the housing will be built by Watt Industries or by a joint venture.”

Based in Santa Monica, Watt has been in the real estate business since 1947. Through the years, Watt and his scores of joint-venture partners have built more than 100,000 houses, resort communities, 8 million square feet of industrial and office space, 50 shopping centers and three major hotels, including the 750-room Stouffer Concourse Hotel at Los Angeles International Airport.

Merselis, president of W&M; Partners Development Corp., was involved in the construction of the Home Savings of America Tower at 7th and Figueroa streets when he was with Ahmanson Commercial Development Co., and with the development of Colorado Place in Santa Monica when he was with Becket Investment Corp.

Watt said he decided to develop his first downtown Los Angeles project when he learned of the opportunity to acquire the Thomas site. Watt bought the land from the Thomas interests in May, 1988, for $57 million.

“Downtown, east of the Harbor Freeway, is virtually all built up, so the logical directions of growth are west and south,” Watt said. “I see a time when high-rise office buildings will line both sides of the Harbor Freeway throughout the downtown area--and Bixel Street will be a major corridor.”

Under the approval agreement, W&M; will have to spend $3.5 million to widen and realign Bixel Street, a hilly north-south street that leads into the southbound on-ramp of the Harbor Freeway. Bixel will be widened from 46 to 86 feet, with a 100-foot-wide potential right of way--and a jog at 7th Street will be eliminated.

W&M; will also realign and widen the southbound Harbor Freeway on-ramp at 8th Street as well as widen 7th and 8th streets.

Designed by the Nadel Partnership, West Los Angeles, the two office towers will be clad in a combination of white flamed (rough) and polished granite and blue-gray glass.

Landscaped plazas designed by Todd Bennitt of Jardin International will cover about 2 acres in front of the buildings along 7th and Bixel streets. Landscaping will include shade trees, water features and sculpture gardens.

The buildings of Watt City Center will be linked by a combination of walks, subterranean driveways and a pedestrian tunnel system.

Although Watt City Center was approved Dec. 15 by a 14-1 City Council vote--with only Councilman Marvin Braude opposed--the massive project has drawn fire from those who claim that it will produce traffic jams on the adjacent Harbor Freeway.

Before the approval vote, W&M; withdrew plans to build a 1,000-space garage for vans and other high-occupancy vehicles to reduce the amount of new traffic.

As approved, the project will have about 3,200 above- and below-grade parking spaces for the two towers, meeting the city code requirement of two parking spaces for each 1,000 square feet of space, Merselis said.