First the landowner couldn’t finance a mixed-use development for the lot.

Then well-heeled developer Jerry Snyder abandoned plans to build a cutting edge high-rise mall there.

Now, yet another effort to develop one of Koreatown’s highest-profile empty parcels at the corner of Wilshire Boulevard and Vermont Avenue across from a Metro rail stop could come to naught.

This time the culprit is last week’s state budget deal, which cut billions from redevelopment agencies statewide.

Land owner Gerding Edlen Development Co. LLC is trying its hand at development again, with a $200 million project that would include 443 apartments and 51,000 square feet of retail space.

But part of the financing is a $4 million subsidy from L.A.’s Community Redevelopment Agency, which agreed to provide the money in order to get affordable housing in the project. That funding now appears unlikely.

“We are going to have to look closely and make some tough choices,” said CRA Chief Executive Cecilia Estolano. “This is a very tough time for us to do anything new.”

The $85 billion state budget Gov. Arnold Schwarzenegger signed July 28 included a bevy of cuts and other provisions designed to close a $25 billion gap. Local governments weren’t excluded from the knife.

The state is taking an estimated $2.05 billion from redevelopment agencies statewide over the next two years; $1.7 billion this year alone. The California Redevelopment Association, which represents city redevelopment agencies, is expected to challenge the legality of the taking. But, in the meantime, Los Angeles officials estimate that the city will lose between $71 million and $85 million of its redevelopment budget this year.

A huge hit like that imperils even the most attractive projects such as the Gerding Edlen development, which is seen as a priority because it’s near a transit center and includes affordable housing. Bridge Housing Corp. planned to partner with Gerding Edlen to build 90 affordable units.

Brent Gaulke, a vice president at Gerding Edlen, asserted the project will move forward without the subsidy, but it would be very unlikely to include affordable housing.

But Andrew Westall, senior deputy for City Councilman Herb Wesson, whose district includes the corner, said that the question of the subsidy creates a “two-fer” problem.

“Without the subsidy they are hard-pressed to do affordable housing and without the subsidy it is difficult for them to get bank financing,” he said.

Star-crossed site

The 2.1-acre site had long housed an aging two-story commercial building before it was razed by Gerding Edlen after it purchased the property about four years ago.

It is across the street from Urban Partners’ 449-unit Wilshire Vermont Station apartment project, which opened in 2007. The $150 million development includes a large retail plaza and is one of the biggest transit-oriented developments in the city.

Portland, Ore.-based Gerding Edlen, which has built three luxury condo towers in downtown Los Angeles, originally planned to build two condo towers on its Koreatown site.

The company couldn’t get financing last year, sources said, and agreed to sell it to Snyder’s J.H. Snyder Co. With much fanfare, Snyder announced plans to build a seven-story vertical mall at the property in September. The 300,000-square-foot project would have included restaurants, a movie theater and dozens of stores. But the developer backed out of buying the project while it was in escrow late last year because of the economic crisis.

“There was not time to build retail back in November when the world was coming to an end,” Snyder said.

Early this year, Gerding Edlen came back with new plans, dropping the condos and replacing them with rental housing.

“Because of the change in the market they came back with a very different scenario to try to do something that would work in this environment,” said Michelle Banks-Ordone, the project manager for the CRA. “The current proposed project is very different from the original.”

Estolano said her organization is in talks with Wesson’s office given the importance of the project and that the CRA will soon bring a revised budget to the City Council that would clarify potential funding.

“We have to see which projects can move forward,” she said. “A project like this it was always important to us if we can make it go forward, it’s a priority.”