The “For Sale” sign is still up at the Hollywood Palladium.
Although negotiations to sell the historic concert hall to Combined Properties Inc. for approximately $65 million broke down last week, it remains on the market with likely interest from multiple bidders, according to a broker familiar with the property.
“It is definitely still for sale,” said the broker, who asked to remain anonymous. “They couldn’t get numbers to work based upon that purchase price. You could probably make it work but for whatever reason they couldn’t.”
In June, the Business Journal reported that Combined Properties, a developer of commercial and residential properties, was negotiating to buy the 4-acre Sunset Boulevard site. Local developers said it would be an ideal location for housing, new shops and restaurants, rather than a concert venue.
Some later reports asserted that the building had been sold to Combined. However, Larry Worchell, chairman of Palladium Investors Ltd., released a statement last week that negotiations were over and the 66-year-old Hollywood landmark would continue to host concerts, fundraisers, and other events, with more than 60 bookings for the remainder of the year.
“We were in negotiations to sell the venue, but that deal was not viable and it is over,” Worchell said in the statement.
But the collapse of the negotiations, rather than dampening interest in the site, will likely cause renewed plays by a number of developers who would like to build projects in Hollywood.
“Hollywood is a hot destination. The only concern out there is the potential softening of the housing market,” said Linda Dishman, executive director of the Los Angeles Conservancy.
The conservancy is seeking to protect the Palladium structure itself, even if the surrounding property on the site is developed.
The Palladium, which has hosted everything from the Academy Awards to Frank Sinatra, has not been declared a historic landmark but Dishman said she considers the structure a “significant historic resource.” And a recent survey by the Community Redevelopment Agency determined the Palladium to be eligible for the National Historic Register.
There has been speculation that a mixed-use development at the site would require the demolition of the hall, but this is not necessarily the case. It’s also possible that incentives which allow for denser development could be offered to the property’s developer to preserve the hall, sources said.
“I think everybody agrees the hall is a difficulty but the general acknowledgment is that a deal that doesn’t include the hall is a non-starter,” the broker said.
Mark Weinstein, president of Santa Monica-based mixed use developer MJW Investments, said a project that includes the venue could work well.
“That adds a level of work and expense but that also adds character to a development,” Weinstein said. “The venue held a lot of concerts, charity events and performances and anyone who would do a development there would run into opposition from conservancy groups if they didn’t preserve the historical aspects of the building.”
Calls to Palladium Investors and Combined Properties seeking further comment were not returned.
