In 2011, Governor Jerry Brown shut down all of California's Community Redevelopment Agencies--local agencies responsible for shepherding development in blighted areas where for-profit developers might not come up with projects of their own--and that left a whole lot of property in limbo. The state is now full of successor agencies responsible for dealing with that property; there were projects slated for some sites, others are still just empty parcels of land. The CRA/LA, for instance, owned some very prime pieces of Downtown, including the 2.4-acre lot on Bunker Hill just east of One and Two Cal Plaza. You might know it as the site where goats are brought in to eat the weeds every so often. Once upon a time there was supposed to be a third Cal Plaza tower built on the land, but that was scrapped way back in the '90s. The Downtown News reports that the site is one of many that the CRA/LA's successor agency has to sell on the open market, and that the city is now looking into buying it so that it can be saved as a "future development" property.
The CRA/LA bought the land back in 1961 for $2.7 million; their initial valuation "places it in the vague category of being worth more than $10 million." It has approvals in place for an office tower, but office space is pretty plentiful in DTLA right now, and meanwhile residential space is tight. As Downtown gets hotter and hotter, the face of office-centric Bunker Hill is also starting to change, with the (slooooow) development of the mixed-use Grand Avenue Project and the eventual arrival of the Regional Connector rail line. On top of all those considerations, one real estate agent says the hillside site will be "very, very expensive" to develop because of the excavation required.
The city has made moves recently to ensure that anything built Downtown is suitably dense for a growing neighborhood with lots of access to transit. If they buy the site, they'll have a better chance of ensuring it ends up with an appropriate project. But whatever happens, it'll take a while: bidding probably won't start on the CRA/LA's properties until June 2015, best case scenario.
· CRA Land Sales Coming, Including One High-Profile Bunker Hill Plot [Downtown News]