Grand Ave Gets a New Backer

DOWNTOWN LOS ANGELES — The Grand Avenue Project has new financial backing, according to a story posted today by the Downtown News.

Related will seek approvals from city, county and redevelopment officials over the next six weeks for the new investor in its proposed Bunker Hill mega-development. The company secured the new partnership with Istithmar, a sovereign fund controlled by the royal family of Dubai, after its key equity partner, California Public Employees' Retirement System, pulled out.

This is great news for the project given the state of the U.S. financing market. Back in October I was on a panel with Jim Anderson of Anderson Pacific. In response to an audience question Jim said that he simply didn't see residential projects getting funded in the next six to twelve months.

This sort of alternative financing is a great move to skirt around the whims of the money market. Ironically, a down market is exactly when you do want to be building. Given how cyclical housing is, getting started now means the project should come online right in the next upswing.

Update (7:45pm): Ironic that the cartoon in this week's issue portrays a deluded Related Co. going nowhere. Such is the timing of life at a weekly.