So the man himself, developer Richard Meruelo, presented his plans for that 11th and Grand tower to a downtown neighborhood group last night. This project made news both because Meruelo Maddux is in bankruptcy protection, but also because some neighbors in this tight-knit community learned about the project after permits were filed. Highlights from Meruelo's 20-minute presentation during the meeting, held at The Exchange on 5th Street:
1. Downtowners Really Love this Project: All the members of the Downtown Planning and Land Use Committee really, really liked this tower. They liked the large size of the units (4,000 square feet and up), a size they believe will lure more families to the area. And they liked the large balconies (1,200 square feet and up) on every unit. They also liked that a gallery is planned for the ground-floor retail space. In fact, they liked the project so much we thought they were going to climb over the table and hug Meruelo. But this group also knows that no one else is proposing any projects in downtown right now. And downtowners want South Park to grow as a community, to see more neighbors and dogs move in, and to see the neighborhood evolve. Still, no one asked Meruelo how he was going to pay for this tower, leaving it to the crabby bloggers in the audience to ask the question...
2. Meruelo Says He Hopes to Announce Funding Soon: “Soon” may be the operative word here. But from his reply to our question about how this would be paid for, it sure sounds like the developer is in talks with various groups to try and obtain financing. "There is financing out there, but it's not pretty," he said. "But we are seeing openings...we hope to announcing financing soon."
So perhaps Meruelo isn't trying to sell this site after all, as some people have guessed? Still, given that Meruelo Maddux is known more as a property owner than a traditional developer, some observers remain skeptical of the company's ability to actually pull this tower off (their one big tower was 717 Ninth, now owned by another company). One source who has been following the company believes that with this project, Meruelo Maddux is "trying to convince the bankruptcy judge that they are still developers, and still developing." In other words, this is all an effort to hold on to their properties.
3. Parking Still in Limbo: Right now, valet parking will be offered for residents. But it’s not clear where the cars will be stored, and Meruelo said no decision had been made. So cars may be stored in that proposed garage around the corner.
4. Even the Creditors Are Confused: Surjit Soni, managing principal of Legendary, the LA-based investment group which owns the loan on the site--they bought it from East/West Bank last summer--showed up at last night’s meeting. He says that he hasn’t been able to get the developer to answer questions about the tower. "“We are concerned his actions may be impairing our interest,” he said yesterday afternoon, before the meeting. "We don't know how he intends to finance this." Legendary had previously tried to foreclose on the site but a bankruptcy judge ruled in favor of Meruelo Maddux.
Funny/awkward moment when Soni finally met the Meruelo Maddux execs face to face. Initial exchange: "I think this is a good thing for all stakeholders," said Andrew Murray, CFO of Meruelo Maddux, of the project. "It would have been nice if you told us about it," replied Soni.
And post-meeting, what does Soni think now? "It's an interesting plan. I'll be curious to see if he has any financing."
5. Meruelo Plans to Develop More: There's more to come...and soon! Meruelo told the panel that there are plans to develop more projects in downtown. "We have many sites...we'll be back [before the downtown panel]," he said.
· Is Meruelo Maddux Putting Up a Tower at 11th and Grand [Curbed LA]