REPORT: Mystery Bidder Emerges For Oceanwide Plaza In Los Angeles

A bidder has emerged for the trio of graffiti-splattered towers that make up Oceanwide Plaza in Downtown Los Angeles. Attorneys representing the building's ownership in bankruptcy court are "in advanced talks" with an undisclosed buyer, The Wall Street Journal reported, citing anonymous sources.

Oceanwide Plaza’s secret bidder would pay approximately $500M to take ownership if no higher bidders come forward by the deadline for bankruptcy bids in mid-August or at a Sept. 17 auction, according to the WSJ. The developers of Oceanwide Plaza estimate they spent more than $1B building the project.

The buyer, identified as a Los Angeles-based developer, would serve as a stalking horse bidder, using its bid to set a baseline for other would-be buyers. This strategy is employed in the sale of bankrupt companies' assets so they don’t get lowball offers. 

Creditors on the project earlier this year filed an involuntary bankruptcy petition against the project's owners to force a sale of the property. 

Bankruptcy court filings indicate representatives for China Oceanwide Holdings Group, the parent of the entity that developed the project, had "several other potential bidders" that it was considering for the role of stalking horse bidder as of July 16. 

Completion of the project would probably require another $800M, a bankruptcy specialist working on the property told the WSJ. 

The project was planned with 504 residences, a 184-room hotel and 153K SF of retail and restaurants.

"While this building has become a very visible symbol of the challenges we’re facing, it’s a superficial one," Downtown Los Angeles Alliance CEO Suzanne Holley told the WSJ.

Holley pointed to Downtown’s residential occupancy, now above 90%, and foot traffic levels that have nearly reached prepandemic levels. 

"Under the current conditions, this project is well-poised to be a very successful development," Holley said.