After a series of long delays and expensive cost overruns, CIM Group Inc. is ready to start construction on what will be downtown L.A.'s only supermarket.
John Given, the company's senior vice president of development, said preparations at the site, dubbed The Market at 9th & Flower, could begin by the beginning of February.
"We've closed all the loops now," Given said. "Everything is set to go.
Located on a surface parking lot on Ninth Street between Flower and Hope streets, the $110 million development will contain a 50,000-square-foot Ralphs. What were going to be rental units will now be as many as 270 loft condominiums in seven stories above the market. The project will also have a 130-space underground parking garage.
Construction was expected to begin in October. Delays were caused when CIM had to renegotiate several contracts to take into account higher prices of steel and concrete.
To make the development pencil out, CIM added another floor of residential units and also switched the housing to for-sale condominiums.
"We've been working to accomplish a project that will pass muster in light of cost increases," Given said. "We've had to reshape the project into for-sale housing."
Sources with knowledge of the deal said CIM has stepped aside to bring The Lee Group Inc. on as the developer. CIM will remain involved as the investor and will lease the retail space. A call to The Lee Group wasn't returned.
Construction will begin fully when the changes to the project that CIM proposed are given final approval by the Community Redevelopment Agency, which is expected to hear the matter at a meeting in mid-February. Calls to the CRA weren't returned.
Irvine Drops Out
While a number of real estate firms have stepped forward to buy the large portfolio of Los Angeles-based CommonWealth Partners LLC, the Irvine Co. has dropped its interest.
"We think that it's a very attractive portfolio, but for reasons we decline to discuss, we've decided not to submit a bid," said Irvine Co. spokesman Bill Rams, reading from a statement.
Formal bids were submitted Tuesday to the portfolio's broker, Secured Capital Corp. Those that expressed initial interest and submitted bids include: J.P. Morgan & Co., a partnership led by Equity Office Properties Trust, Houston-based Hines, Trizec Properties Inc. and Maguire Properties Inc.
The 13 office-building portfolio could go for between $1.5 billion to $1.6 billion, sources familiar with the sale have said.
CommonWealth officials are discussing the bids with each bidder, trying to get a sense for which would have the easiest time closing on the portfolio.
Last month, CommonWealth listed its entire 6 million-square-foot portfolio, which includes the 53-story tower at 777 S. Figueroa St. in downtown L.A. and three high-profile Glendale office buildings.
CommonWealth owns its properties through a partnership with Rockefeller Group International Inc. and the California Public Employees Retirement System, which voted at the end of last year to cut back its overall real estate holdings. Calpers spurred the portfolio sale, sources said.
New York private equity firm Real Estate Capital Partners paid Westside investor Kevin Green $31.2 million for the Bank of America office building in Beverly Hills.
Real Estate Capital Partners, an adviser to a German pension fund, paid all cash and closed on the property in 30 days. Green bought the building, which sits on a ground lese with 52 years remaining, in 2003 for $21.9 million.
The 87,000-square foot building located at 9440 Santa Monica Blvd., in that city's prime Golden Triangle market, is mostly occupied by the bank, which late last year renewed its lease for 10 years a deal worth about $15 million.
Green had initially sought about $35 million for the property. Aside from its office space, the building also has about 28,000 square feet of retail stores on its ground floor.
Madison Partners' Safai represented both Green and Real Estate Capital Partners.
The owner of the Glendale Galleria has lost its last attempt to stop construction of a new mall at its doorstep.
Superior Court Judge Robert O'Brien ruled against a lawsuit brought by General Growth Properties Inc. intended to block construction of Caruso Affiliated Holdings LLC's new shopping center, Americana at Brand.
General Growth claimed there were flaws in Caruso's environmental studies and the approval process followed by Glendale officials.
The suit was the last obstacle preventing Caruso from starting construction. After the Glendale City Council approved the $225 million project, General Growth appealed the issue to a September special election where voters narrowly approved the new shopping center.
"We are pleased with the decision but not surprised," Caruso said in a statement. "It is great news for Glendale and for our company."
Americana at Brand will be similar to another successful Caruso center, The Grove. The Glendale project will encompass 475,000-square-feet of retail, dining and movie theaters with a 2-acre park surrounded by a pedestrian promenade and fountains.
Long Beach Listing
The Parkview Village Shops, which consists of three city blocks of retail and office space in Long Beach, have been put on the market for about $20 million.
Parkview Village includes 11 buildings with 94,841 cumulative square feet in a 20-building center at the corner of Bellflower Boulevard and Carson Street. The site has entitlements for an additional 21,000-square-feet of retail space.
David Ridgway, a senior investment associate in Marcus & Millichap's Los Angeles office, has the listing. Ridgway said the seller, a Santa Monica-based firm, won't reveal its identity..
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