For 14 years, the southeast corner of First Street and Grand Avenue has sat in a sort of limbo, awaiting a project that would raze an outdated parking structure and replace it with a gleaming mega-development designed by architect Frank Gehry. Now, finally, it is moving forward.
New York-based developer Related Companies this week announced that it has secured the financing needed to get the $1 billion development dubbed The Grand off the ground. Initial site preparation is underway.
On Monday, Nov. 5, Related said it had secured $630 million in construction financing from Deutsche Bank. That follows the announcement last year that Chinese firm CCCG Overseas Real Estate Pte. Ltd., also known as CORE, will contribute $290 million to the project.
The Grand, which will replace the “Tinker Toy” parking structure across from Walt Disney Concert Hall, would create 436 residential units, 20% of which would be set aside as affordable housing. It is expected to open in the fall of 2021, according to Related Senior Vice President Rick Vogel.
“Downtown Los Angeles, particularly Bunker Hill, needs this project,” Vogel said in an interview. “Bunker Hill has the largest collection of performance and visual arts centers in the city, but it lacks the soul and substance of a neighborhood. There are few residents, no meaningful retail, and only a handful of restaurant options. This project is going to turn Bunker Hill into a true 24/7 neighborhood.”
The Grand will include a 39-story residential tower and a 309-room Equinox hotel in a separate 20-story building. Those will be arranged around a 215,000-square-foot commercial space with a central plaza that opens to Grand Avenue. There will be an assortment of shops and restaurants, a movie theater and landscaped terraces. The project will have a five-level underground parking garage.
Securing financing marks a breakthrough for a project that has been discussed for nearly two decades. In 2004, Related and Gehry won a public bidding competition for development rights to a collection of city- and county-owned parcels. A $2 billion plan was put forward, with construction slated to start in 2007, but that was stymied by the global financial collapse.
There has been some activity since 2004. Related paid $50 million up front for the development rights, with the money used to fund the creation of Grand Park in 2012. Additionally, Related opened the 271-unit apartment complex The Emerson at 225 S. Grand Ave. in 2014.
Rachel Moore, president and CEO of the Music Center, which occupies much of the area around The Grand site, said that like Grand Park, Related’s project has the potential to reshape the civic and cultural landscape of Grand Avenue.
“The Music Center is eagerly anticipating the arrival of The Grand on Grand Avenue across from The Music Center’s beautiful Walt Disney Concert Hall,” Moore said in a statement to Los Angeles Downtown News. “This new development will not only contribute significantly to the revitalization of the Grand Ave Arts corridor, but will also be a wonderful complement to the renovation of The Music Center Plaza, which will open in the late summer/early fall of 2019.”
Related also relinquished another parcel in the original development agreement — that site now hold the museum The Broad.
Work starts this week with site preparation and inspection. The Tinker Toy lot is expected to close in the coming weeks, Vogel said.
County Supervisor Hilda Solis, who heads the Grand Avenue Authority, a city-county joint-powers authority overseeing the development on Bunker Hill, welcomed the news of the financing.
“This project will create permanent jobs and build much-needed affordable housing in my district,” Solis said in a prepared statement. “With Frank Gehry’s visionary design supporting a variety of community-supporting mixed-use development, I am excited for the future of Grand Avenue and the larger neighborhood.”
The parking structure will come down in the next six to eight weeks, Vogel said. Excavation is expected to begin before the end of the year, with formal construction starting in early 2019.