A prime development site overlooking Pershing Square in downtown Los Angeles is being sold to a San Francisco developer.
The pending sale to MacFarlane Partners marks the end of Park Fifth, one of the most ambitious real estate projects ever proposed in downtown Los Angeles, and the dawn of another, less grand, development.
In 2007, plans for a $1-billion residential and hotel complex were announced by Los Angeles developer David Houk, who had owned land at the northeast corner of 5th and Olive streets for decades. Houk planned to build two condominium towers including a 76-story skyscraper, a 15-story residential building, a 212-room hotel and restaurants.
Houk said he had committed financial partners and hoped to start construction by 2008. The nation's economic collapse brought the project to a halt, however, as money for real estate development dried up.
MacFarlane Partners is in the process of buying the 99,000-square-foot parcel in a transaction expected to close by spring, President Greg Vilkin said. The company plans to halve the scope of Houk's project but still create a substantial new complex north of Pershing Square.
The plan is to develop the site — now used as a parking lot — into a mid- and high-rise complex with 600,000 square feet of residential and retail uses, he said. MacFarlane is in the early stages of design, and the number of apartments or condominiums has yet to be determined.
"Our plans slice the size of the Park Fifth proposal in half, thereby cutting back the environmental impacts such as pollution and traffic, which were previously contentious issues," Vilkin said.
He did not disclose the price of the pending transaction, but said the firm is optimistic that the neighborhood's residential boom has legs.
"This investment reflects our confidence in the strong market for apartment properties downtown, which continues to experience a significant increase in rents," Vilkin said.
"While the transit-oriented development has yet to be designed," he said, "it will incorporate the best elements of smart growth and new urbanism, which are hallmarks of our developments."