Real Estate Column—Downtown Land Swap Key to New Caltrans Building

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The state of California and city of Los Angeles are mulling a land swap that would pave the way for the California Department of Transportation to build a new headquarters in Downtown L.A.

The proposed deal involves adjacent blocks between First and Second streets bounded on the east by Los Angeles Street and to the west by Spring Street.

Caltrans wants to move from its present digs at 120 S. Spring St. into a proposed 603,500-square-foot building in the block immediately to the east. That block is one-third occupied by a strip of commercial operations fronting First Street and two-thirds covered with a Caltrans parking structure.

The new headquarters building would allow Caltrans to consolidate 1,800 employees now crowded into its two-building District 7 operation as well as potentially house the offices of the Los Angeles Department of Transportation. Bringing LADOT into the scenario would require building another 112,700 square feet.

“Caltrans, because of its growth, has high density in the old building, (which) is not up to code,” said Bob Sleppy, chief of the environmental services section of the real estate services division of the state Department of General Services.

Under the Caltrans proposal, the city would acquire the privately-owned commercial properties on the site and exchange them for the present Caltrans headquarters site. That would give Caltrans the whole block in which to build its new building, which would include 932 spaces of multilevel, structured parking. If the state builds the larger building to accommodate LADOT, the parking would be bumped up to 1,140 spaces.

The city, in turn, would tear down the present Caltrans building and use the open space as part of a proposed Civic Plaza.

The dollar value of the swap could not immediately be determined.

Sleppy said the project is contingent on the state budget passing later this month and the city’s approval of the land swap. If all is approved, construction would begin in the first quarter of 2002 and the building could be ready for occupancy by 2004.

Caltrans could move ahead and build its own HQ without the land swap, but prefers some room to breathe, Sleppy said. “It would be a nicer and better project if we could build on that First Street frontage,” he said.

An Environmental Impact Report regarding the project is available for public review and comment through Aug. 20. A public hearing on the project is scheduled from 5 to 8 p.m., Aug. 1 at the Junipero Serra state office building at 320 W. Fourth St.


Century City Swaps

Douglas Emmett Realty Advisors has a deal to buy 1901 Avenue of the Stars, according to Westside real estate sources, making it the second Century City high rise to go to contract in recent months.

Sources said Douglas Emmett is under contract to buy the building for $155 million (about $322 per foot) from Divco West Properties of San Jose.

Douglas Emmett officials did not return calls for comment. A spokesman for Divco West declined to comment on the matter.

The 19-story building, 481,683-square-foot Class A office building has four levels of subterranean parking and, according to the Divco West Web site, is 96 percent occupied.

Divco West bought the building from Shuwa Corp. in 1996 for $96 million ($200 per foot). Sources said the building is primed to make some money because it is full of undermarket leases ready to roll.

The deal follows on the heels of a deal in the works for 1888 Century Park East. Insiders have reported that the investment arm of Insignia/ESG Inc. is in escrow on a $124 million deal ($255 per foot) to buy that 486,000-square-foot Class B office tower from the Canadian office property company Bentall Corp.


Iguana Crawls to Hollywood

Calabasas entrepreneur Dove Cohn, who owns Iguana Vintage Clothing in Sherman Oaks, is in escrow on a $670,000 deal to buy a piece of Hollywood property where he plans to build another store and offices.

The 7,500-square-foot building, at 6320 Hollywood Blvd., is grandfathered under the city zoning ordinance because a building there was knocked down by the Northridge earthquake in 1994, according to John Tronson, a principal at Ramsey-Shilling Commercial Real Estate Services Inc., who represented buyer and seller in the transaction. Tronson said Cohn could build up 15,000 square feet on two levels.

The seller, Hollywood N Vine Academy, had bought the property a few years back intending to build a golf academy, Tronson said.


Housing Office

1000 Corporate Pointe LLC sold the 25,000 square foot building of the same address in Culver City to Century Housing Corp. for a reported $250 per foot.

Century Housing, a provider of affordable housing, will move from its home at 300 Corporate Pointe into vacant space at the building. Jeff Pion of CB Richard Ellis Inc., who represented Century Housing, said the company would and maintain the remaining tenants, which include United International Mortgage and Investment, Fujita Corp. USA and Colby Care Nurses Inc.

Staff reporter Christopher Keough can be reached at (323) 549-5225 ext. 235 or by e-mail at [email protected].

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