Downtown Los Angeles may get a new hotel courtesy of iconic designer Frank Gehry. A long-in-development project across the street from the Walt Disney Concert Hall (also designed by Gehry) has just received an investment of $290 million courtesy of a Chinese builder.
Construction on the $1-billion Grand Avenue Project is expected to begin next year, according to New York developer Related Cos., thanks in part to its partnership with one of China’s largest state-owned companies, China Communications Construction Group. A subsidiary set up to carry out foreign development is making its U.S. debut.
“For our first project in the U.S. we want to be in a city with a large population and a stable economy,” Mark Guo, director of business development for the Singapore subsidiary, called CCCG Overseas Real Estate, told the Los Angeles Times. “Gateway cities such as Los Angeles are the most attractive targets.” Guo said CCCG Overseas Real Estate joined the project because it is “high-profile and high-end,” and because the city and county of Los Angeles are parties to the development, providing subsides including tax breaks valued at nearly $200 million. “We know government projects never fail,” Guo said.
With the initial investment, Related and CCCG Overseas Real Estate have raised $400 million for the project—a significant milestone as it means the companies will be able to borrow less than 70 percent of the total amount needed. “This should say to everyone that this project is not over-leveraged,” President Ken Himmel told the paper. “It’s a tremendous vote of confidence to see that amount of equity go into the project.”
Gehry’s design calls for a 20-story hotel tower (no brand named yet) and 39-story residential tower.