DOWNTOWN LOS ANGELES - Developer David Houk is close to securing a new investor for his proposed $1.3 billion Park Fifth project, he said this week.
“We have agreements, but nothing has happened yet,” said Houk. “It’s in process.”
The potential partner, Gabriel Hertzberg of the Triangle International Oil Company, said that he plans to take over for Park Fifth’s financially troubled former capital partners, Africa-Israel Investments and the Brentwood-based investment company Namco Capital Group. Hertzberg also said that he would purchase the site and provide a construction loan for the project.
This would mark Hertzbergs’s first real estate development. He refused to disclose the loan amount, but said that it would amount to hundreds of millions of dollars.
“We own oil in the Middle East and have the funding to get this project,” he said. “I will probably be the owner of the whole thing.”
Hertzberg said he is in the process of transferring money to U.S. accounts and expects the deal to be finalized within a few weeks.
He added that plans for the fully entitled development, to rise on a parking lot at Olive and Fifth streets north of Pershing Square, have not changed.
Those plans call for a 76-story building that would be the tallest residential structure west of Chicago, a 44-story tower and a 15-story residential building. Altogether the project would contain 790 condominiums, a 212-room hotel, retail and restaurants.
The new interest does not mean that the development will come online any time soon. Hertzberg said that he would like to break ground within six months if the deal comes to fruition, but real estate observers say it could be years before the economy can support large-scale development projects hinged on selling high-end condominiums.
Construction, Hertzberg said, would take at least three years.
Houk put the project up for sale in the summer of 2009. He would remain involved in developing Park Fifth if Hertzberg comes on board in financing it.
For years, the proposed development was marked by a large sign on the site with the project’s name, a telephone number and the slogan “Downtown Is Looking Up.” Yet the sign was not maintained, and was splattered with large blotches of colorful paint. Houk had the sign painted over late last year.
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