Group's Bid For Historic Black Neighborhood Site Falls Through
For the second time this year, developers have backed out of buying and redeveloping the Baldwin Hills Crenshaw Plaza mall.
This time around, New York-based developer LIVWRK and DFH Partners abandoned their plans to buy the mall and remake it about two months after their involvement was announced.
The mall is located in a historically Black neighborhood and along Crenshaw Boulevard, arguably the cultural heart of Black Los Angeles. There has been general resistance to the mall's sale throughout the community, often in the form of widely circulated petitions and social media campaigns, but it remains unclear why the sale to LIVWRK fell through. A previous attempt to buy the mall by CIM Group earlier this year collapsed after community protest.
“We have confirmed that the agreement for LivWrk to purchase our beloved Crenshaw Mall was terminated as of Friday, December 11,” Downtown Crenshaw Rising posted on its site Tuesday.
A source with knowledge of the deal confirmed to Bisnow that it had fallen through.
There is still the possibility of a future sale: DCR, a coalition of more than 150 community groups, civic and faith leaders and former government officials, has arranged financing and submitted its own $100M bid to purchase the mall, with the goal of having a team leading the redevelopment that is already rooted in the community.
DCR is still pursuing its vision for the mall. When the demise of the LIVWRK deal came to light, board member Damien Goodmon said in a statement that DCR's offer still stands and "remains 5% over the next most credible offer."
The mall’s owner is a private equity fund, Capri Urban Investors, but thus far the sale of the mall is being overseen by asset manager DWS Group. It is unclear how much involvement Capri Capital has in the process.
No total has been confirmed for what LIVWRK and DFH Partners offered to pay for the site, but the previous accepted bid was over $100M.
LIVWRK did not respond to requests for comment. A representative for CCP declined to comment.
CCP bought the mall in 2006 on behalf of a pension fund separate account for $136M. The Black-owned, Chicago-based real estate investment management firm spent years doing community outreach and working with local residents and elected officials to create a $700M mixed-use redevelopment project at the mall site that would bring residential, retail and hotel uses to the roughly 40-acre site near Crenshaw and Martin Luther King Jr. boulevards. Those plans were approved in 2018.
In April, developer CIM Group planned to pay more than $100M for the mall. CIM said that it envisioned converting some of the larger, empty retail spaces that housed a Sears and Walmart into office space. CIM did not plan to bring housing to the site, which had been a large component of a previous redevelopment plan for the mall.
Reasons for pushback were varied and included allegations of ties to President Donald Trump and Kushner Cos. Jared Kushner that CIM refuted, but the resistance usually boiled down to fears about the effect a CIM-led development would have on the neighborhood.
“Los Angeles’ Black community, and many who have concern for its future, did not want Crenshaw’s economic anchor put into the hands of a company with such a troubling history and business practices in communities undergoing severe displacement pressures,” a petition on the DCR site said.
After an organized resistance of local residents mounted, CIM withdrew its plans in June. The company posted a message on Instagram saying, “CIM has concluded that the community, the Mall, and CIM are best served by us stepping aside.”
When LIVWRK emerged as a new prospective buyer, DCR pushed back again. “It is simply the latest in the saga to wrestle control of the Crenshaw Mall out of the hands of those who would do the Crenshaw community harm and into the hands of the community,” DCR said in a statement at the time.
LIVWRK CEO Asher Abehsera said at the time that he wanted to talk to the community before making a redevelopment plan for the site.
The nearly 870K SF mall has been largely shuttered since March due to the coronavirus. Even before the pandemic, the shopping center had lost major tenants, including Walmart and Sears.