COMMENT OF THE DAY: WILSHIRE VILLAGE LOGIC “I am really amazed at this debate. The principle is very simple. The land is too valuable for the revenue generating capacity of existing structures. You can’t rent those spaces for enough money, no matter how you remodel. This is definately a high density project and could be high-rise site in a better market, where are you going to find north of 7 acres in an area like this? The Fiesta across the street is in the Cohen family, so that could be in play. The Cohen family is surrounded by real estate guys. The real shame here, is that you have complicated personalities that probably prevented any new construction during a time in which it would have been viable, so now they are trying to market a property in a climate that almost no one can get financing that would make a deal work. A new project would have provided comfortable living space in a convenient and desirable location, with maybe even a mixed use component. You tear down 40+ year old properties, that have a great deal of deferred maintanence, for marketing purposes, and now they can showcase those beautiful magnolia trees, which I hope they can preserve as many as possible, but it has to make economic sense. I am sure that if someone will make a fair market value offer, and they are a credible buyer, they would sell. Death to rumors. The dirt could be as much as $100 a foot, if you turned back the clock 2 years. It is special so may still demand it.” [Alexander, commenting on All Cleaned Up and Ready for Sale: What Can We Get for Wilshire Village?]
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The question is what is a fair market value today … and the answer is it depends what you do with the tract. This tract was never worth $100 PSF and this was never and probably never will be a site for a high-rise. I hear Dillick wants $50-$60 PSF for the land now and I am not sure what works there at that price tag. At $50-$60 PSF, I can tell you it is not going to be retail or office or multi-family.
I hate to say this but Dillick is probably the only one with low enough basis in the deal that can make this site work at the end of the day, because I just do not see how this deal gets financed today plus I hope developers learned their lesson not to purchase land (or other assets that produce no income) with debt!!
Land guy, you make a lot of good points. I have seen very good innerloop land trade north of $70 a foot for apartments. I don’t know what Gables paid for West Ave. dirt, but I heard it was a long term land lease from Dickey family from a good source, and prices were being discussed in the $100 a ft range, however that land is a much better location. I would doubt that Matt would sell for $50 per ft., and sure that Cohen would never go for that, unless for some extroadinary circumstances. I could have it under contract tomorrow at $50 per ft., probably at $60 per ft., after that it gets much more difficult. My guess would be some form of participation at a much higher valuation, a JV with a heavy hitter that does not want to pay the current equity requirements, nor want to put in the amount of equity that a lender would require, because there is probably little debt on the property, and have not studied it lately, but suspect there is still a reasonable demand for good apartments in this area, if was coordinated with upgrading the Fiesta retail center, I can see a potential viable deal, but still very tough.
I was just trying to bring some reasoning to the debate, do not post much, but enjoy reading. I find it incredible that so many people are so passionate and believe that they have the right to dictate what happens to a property, that they have no financial interest in, determined to try to defy free market forces.
I doubt anyone seriously believes that they have the right to tell another what to do with his/her inanimate property. It’s also a fact that everyone will die at some point, but I hope no one attends a funeral and announces such as justification for why mourning is a waste of time. For a myriad of reasons, Wilshire Village meant something to many, many people. Frustration and wishing that the end result could have turned out differently are normal components of grief. So is venting anger.
Those who are pleased about the razing can cite facts and figures until the cows come home as this is a public forum, but please have the grace not to get indignant if those who are not in agreement don’t “see the light” and celebrate with you.
Wilshire Village is gone, but there are sterling examples of renovation and reuse of buildings once deemed eyesores such as the Plaza Hotel and Elder Street Lofts, and there will be more in the future. I’m hoping that the Alabama Theatre will be among them.
I doubt anyone seriously believes that they have the right to tell another what to do with his/her inanimate property.
Have you heard about Ashby Highrise?
Apologies – I should have made it clear that I was referring to this particular non-torch-and-pitchfork situation. Or signs, for that matter.
Alexander said, at the end of a reasonable and informative post:
“I was just trying to bring some reasoning to the debate, do not post much, but enjoy reading. I find it incredible that so many people are so passionate and believe that they have the right to dictate what happens to a property, that they have no financial interest in, determined to try to defy free market forces.”
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People, especially ones who have lived, worked, shopped, and played in the area for a long time, hate to see their landmarks disappear. They hate to see well-designed, well constructed buildings torn down. Like it or not, there is zero doubt that Wilshire Village was architecturally and historically significant, and this sad story proves that the free market and owners property rights are about as useful a preservation tool as a hammer would be in repairing a broken porcelain vase. The pendulum has swung pretty darn far in the laissez-faire direction; coming back over in the other direction a little wouldn’t be a bad idea.
cohen no longer has the land. now if whoever bought it is an agent of another branch of the family, that could be possible…anyway, a high density project in this economy isn’t going to happen.
To Marmer, so your okay with me dictacting on how your property looks or is being used. My guess is that you don’t own property, because if you did, you would be offended by your neighbor dictacting to you on what you did with it. What if I wanted you to paint your house fire engine red, and plant your front yard with only poison ivy?
Wilshire Village was a catastrophe, can not understand how it has gone this long without being violated by the city. The place was falling apart. You obviously have not walked the property. The whole place was a hazard. Why exactly is it historically and architectually significant? Why does this even matter, you could say that any structure built in the past is historically significant. So we simply stop progress, in order to bow to some past built structure. The Statue of Liberty is historically significant, The Liberty Bell, and other sites where certain significant events took place in the history of America, not a broken down 50 year old apartment complex, that has much better purpose in this urban environment. The building was not significantly well designed or constructed, it was ahead of the times in that era, but before it was demolished, it was a dump and a hazard, and a poor use for that land. Just because something is old does not make it significant to keep. Have you seen any wagon wheels lately?
The building was not significantly well designed or constructed, it was ahead of the times in that era, but before it was demolished, it was a dump and a hazard, and a poor use for that land.
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It was in better shape than the crap built all over this city in the 1960s that the city does absolutely nothing about.
Given the pending foreclosure something really does stink about this. Including, or particularly, the city’s interest in demolishing it as quickly as possible.
No doubt we will find the interest has to do with someone’s conflict-of-interest and no doubt that someone is Bill White.
Alexander, From under what rock did you just crawl?
Should be interesting to see what kind of deal wheeler-dealer Alexander puts together since the land is obviously going to be very cheap at this point. And probably already committed as they say. Meaning pity those who dare to bid too high.
Auction unlikely, but Wilshire Village site on-the-block
http://www.hcnonline.com/articles/2009/11/01/west_university_examiner/news/wu_wilshire_auction.txt