Black-Owned Investment Company’s $700 Million Project Will Redevelop South Central, LA
Calling its approval a “milestone,” black-owned investment company Capri Investment Group has the green light to proceed with plans to redevelop the Baldwin Hills Crenshaw Plaza in South Central Los Angeles.
The Los Angeles Planning Commission recently approved a proposal by the Chicago-based real estate investment firm to expand and revitalize the shopping mall, located in the neighborhood where the movie Training Day was filmed.
New Housing, Hotel, Retail Stores, and Restaurants
A master plan for the $700 million mixed-use project includes adding 961 condos and apartments, a new 400-room hotel, a 10-story office building, retail stores, and restaurants. Additionally, plans call for more than tripling the plaza’s size to over 3 million square feet.
Simultaneously, the project, viewed by some as a cornerstone of rejuvenating Crenshaw Boulevard, faces some opposition from residents and must get final approval from the Los Angeles City Council.
Project supporters contend that with online shopping increasing, malls potentially face closure if they don’t provide places where people can reside, work, and have fun. Backers contend that South Central is worthy of having such an upgraded commercial undertaking like other Los Angeles areas. The existing plaza is called “America’s oldest urban regional mall.”
Potential Gentrification, Dislocation Among Residents’ Concerns
Among the concerns residents express is that the project could lead to gentrification and dislocation, potentially hurting black residents from nearby areas with limited financial resources. They fear the redevelopment won’t provide affordable housing in an area already facing a housing crisis.
Luci Ibarra, a senior city planner with the Los Angeles Department of City Planning, stated by email that “City Planning recognizes the importance of preserving this iconic treasure in South LA.” She says her office considered the redevelopment of the site as a way to facilitate its continued presence in the community while addressing the opportunity to provide additional retail/restaurant services and replace surface parking with new housing near public transit.
Quintin E. Primo III, Capri’s chairman and CEO, No. 8 on the BE Asset Managers list with $3.40 billion in assets, told Black Enterprise that Capri has owned the urban mall since 2006 for institutional investors. Capri has sought Planning Commission approval for the entitlements for the past eight years, he says.
“While there still is a governmental and community process to be completed for this large, complex and socially impactful investment, we believe its redevelopment holds the potential to become the new City Center for South Los Angeles, a chronically underserved minority area,” Primo says.
“The Planning Commission approval represents a milestone for Capri and reaffirms our commitment to diversity and inclusion as we seek to improve each and every community in which we invest.”
Setting Aside New Homes for Lower-Income Earners
Capri has agreed with the city to ensure 10% of the apartments and condos are targeted for people that fall under set income guidelines, a greater percentage than initially suggested.
“We believe that increasing the affordable units to the suggested requirements of the planning commission will not overly impede the financial economics of the project,” Primo says.
Ibarra says the Los Angeles Department of City Planning supports the commission’s requirement to provide 10% of the residential units for very low and workforce housing levels. She added because there are no homes at the site, no one would be directly displaced due to the redevelopment project.
On a citywide level, Ibarra says city planning is well aware of the pressure on our existing housing stock all of its communities face. “Right now, the city is experiencing an unprecedented need to produce more housing to alleviate those pressures. Projects, such as the Baldwin Hills Crenshaw Plaza, can lead to better housing choices for all,” she says.
Investing in an Area Not Targeted by Traditional Investors
Primo is asking Planning Commissioners to offer Capri “flexibility,” stressing that his firm still must raise $500 million to $700 million to complete the redevelopment project in “an area that has been grossly underinvested and underserved” by institutional investors and major retailers.”
All told, Primo expects the redevelopment will cost $700 million, marking the first time that amount of private commercial capital has been invested in South Los Angeles.
“We will create a project that will be worth well over $1 billion over the next five to seven years.” The redevelopment is expected to be completed in that time frame once work begins.
The master plan calls for adding more than 2 million square feet of new space, including the previously mentioned additions. Another amenity will be an open-air retail village with a grand entrance that will provide a stronger connection to the community.
Anchor Stores and All Other Retailers Will Continue to Operate
An existing 870,000 square-foot mall and a 15- theater Cineplex will stay open, but some free-standing buildings on the 43-acre site will be torn down. Two anchor stores, Macy’s, and Sears, plus all other retailers at the mall will continue to operate.
The revamped center will be next to a new Metropolitan Transportation Authority station expected to open by 2019. Capri has agreed with planning commissioners that 25% of all jobs created during construction and operation of the expanded plaza will be offered to local residents.
Primo hopes to get city council approval on the project by late this year.