Park Fifth Project: 30 Years of Planning Yields Promise of West's Tallest Residential Building

The news is out that your Park Fifth mixed-use development project may include one of the tallest residential towers in the Western United States, to be built on the edge of Pershing Square in Downtown Los Angeles. What are your aspirations for Park Fifth?

First of all, to clarify the "tallest" issue: we are building a 76-story residential tower. The floor to ceiling height of a residential tower is dramatically different than an office building. While the number of floors seems like a lot, the actual height is slightly taller than the Gas Company tower. It's nowhere near the size of the U.S. Bank tower.

We are planning, to the best of our knowledge, the tallest residential tower west of Chicago, but not the tallest building. Park Fifth will have two towers, 76 stories and 43 stories, including 735 condominiums and 218 five-star hotel rooms, plus ground-floor retail. That's the project's general description.

What is this ambitious development project's history? Your involvement, we know, spans decades; share some of the project's timeline.

I made the offer for the first property in 1977. We started our entitlement process in ‘79; Tom Bradley and other civic leaders invented the variation process for this project many years ago. It's a long story that I won't bore you with for this interview, but we completed the land assemblage and the entitlement process to build a mixed-use office/hotel/retail project and completed a joint-venture agreement with Kajima in 1990, just in time for the Downtown Los Angeles market to crash.

We purchased Kajima's position in 1998 with funds from our then-parking operator System, which became System Development Company. A couple years ago, we worked out an agreement with System to purchase their interest and replace them with our current partners, Namco Capital and Africa Israel Investments.

How was the approval process, which you have endured for years, to win approval for this project and these two high-rises?

We've been able, fortunately, to maintain the entitlements we secured in 1990; so we're not starting from scratch. We, however, are doing a new environmental impact report. Assuming we hit our schedule, the EIR will be completed sometime in October or November. We've started the process and are confident we can get it done before the end of the year. Based on that, our current schedule is to start construction immediately after the first of the year.

Who does Park Fifth's design team and supporting cast include, and how have they been engaged to execute your vision?

The design architect is Kohn Pedersen Fox. They've done a fabulous job. Their design has already won the AIA New York Award for the best un-built design of a high-rise residential project, and they just picked up a 37th Annual Los Angeles Architecture Award from the Los Angeles Business Council. The executive architect is Leo A. Daly's L.A. office. Nabih Youseff is our structural engineer, and Turner Construction is working on the construction. The marketing company that is putting together and running our sales force is Vertical Property. And there's a whole string of other consultants filling in all the other gaps.

As a veteran of Downtown development spanning three decades, what is it about the market today that makes this development both realistic and financially promising?

I can tell you what Deputy Mayor Bud Ovrom told me a number of months ago, probably near over a year ago, when we first started talking about starting up again. He said, "David, in my memory, this is the first time in a long time that all the stars are lined up in your favor. The council is interested in seeing transit-oriented projects in Downtown." We're attached directly to the Pershing Square Metro station. He also said, "The CRA is intrigued with moving forward, and the market also seems to be in your favor," which we choose to believe is still true. We're not dealing with today's slumping market because we won't deliver units until 2010 and 2011, and we are confident that we'll be in a good market by then.

This announcement of your Park Fifth project coincides with similar developments at Grand Avenue, at the Zen Tower at Third and Hill, and the projects around Staples, L.A. Live. Obviously, there are a number of players who think the downtown L.A. market is quite hot. Since you've been through a crash before, what benchmarks are you relying upon to give you comfort that in the years it'll take to complete Park Fifth, the market for your product will not cool?

My confidence is based on the partners that are working on this. They have projects in other parts of the world. They are committed to going forward and are confident that we're going to get it built. I think Downtown is behind other downtowns; the phenomenon of people living in Downtown is relatively new. We spent many years debating whether anyone would ever live Downtown. We're no longer debating whether people will live Downtown. Now, we're debating how many people will live Downtown. I believe that in Los Angeles the era of building horizontal is getting further and further into the past. With the people who want to live, work, and play here, we have to build up. And the simplest place to build up is Downtown L.A. We've spent over a trillion dollars building transportation systems-from freeways, to bus lines, to trains and metro rails-that all meet in Downtown. The infrastructure is in place to accommodate building up in the air, and it's the logical place to introduce a vertical lifestyle.

Pershing Square, which is on the edge of your project and one of the focal points of Downtown, has, for more than 20 years, seen its neighbors turn its back on the park. How does the Pershing Square-present and future-fit into your project vision?

Not all the neighbors have turned their backs on Pershing Square. We've participated with all the property owners around the square and are voluntarily taxing ourselves to support the Mello Roos tax district that paid for the last restoration of the park, and we're still paying for it. We have been having very encouraging discussions with city officials to use public benefit fees and Quimby fees. We've hired a landscape architect to start exploring what we might be able to do to make the park more of a grass and tree park. That's not conclusive, but we're starting to see if we can accomplish that as we're going through our project.

In closing, if TPR interviewed you on Park Fifth next year, what will we be discussing?

Hopefully, the view from the top of the first tower.