LA’s Bankrupt $1.2B Chinese-Owned Graffiti Towers Put On Sale

For sale: Steel skeletons of three towers in downtown Los Angeles, erected by a Chinese developer that spent $1.2 billion before running into financial troubles, John Gittelsohn reported for Bloomberg News.

China Oceanwide reported efforts to find a buyer or new financial partners for the LA project, deals that never came to fruition. I Photo: Benoît Prieur Wikimedia Commons

The site, called Oceanwide Plaza, became famous this year when graffiti artists covered the 49-floor-tall structures. Now, the property is going on the market, with lenders and other creditors needing about $400 million to recoup their money.

The brokerage Colliers and advisory firm Hilco Real Estate have been hired to market and handle a sale of the property, subject to bankruptcy court approval.

China Oceanwide spent about $3.5 billion on projects in San Francisco, New York, Hawaii, and Los Angeles, none of which were completed. Construction in LA, the biggest project, ground to a halt in 2019.

China Oceanwide reported efforts to find a buyer or new financial partners for the LA project, deals that never came to fruition.

“We are determined to run a disciplined and orderly process to identify the right developer to finish the project in time for the 2028 Summer Olympics,” said Mark Tarczynski, an executive vice president at Colliers.

The project got off the ground in 2014 as Chinese investors were in the midst of a US buying spree, scooping up properties from trophy hotels to Hollywood studios.

By 2018, that boom went bust when Beijing tightened capital policies and cut off financing for international ventures. China’s domestic property market bubble later burst as developers struggled with overbuilding and high leverage.