Boston-based lender UC Funds has foreclosed on a 126-unit luxury apartment complex in Koreatown that’s still under construction, The Real Deal has learned.
UC Funds acquired the property, located at 2870 West Olympic Boulevard, out of auction, submitting a winning bid of $33 million, according to a deed filed with the Los Angeles County Registrar’s Office. The auction took place Oct. 6, about a month after the firm claimed a default on the planned complex. UC Funds did not return a request for comment.
UC Funds provided a $30 million construction loan on the property in March 2020, reports show. The previous owner of the property, developer LiveWorkCreate, proposed a seven-story, 105,000-square-foot multifamily complex, with 13 apartments set aside as affordable housing.
LiveWorkCreate’s plans replaced a proposal to build a hotel with 120 rooms at the site. The hotel project was approved by the city in 2018. However, the entitlement process was halted after union Unite Here Local 11 filed a last-minute appeal questioning the environmental impact analysis for the development. In its appeal, the union claimed that the assessment for noise and greenhouse gas impacts of the project were inadequate.
LiveWorkCreate continued with the development process. According to an article from June last year, the firm had completed the wood framing for the project. The development was projected for completion that year.
UC Funds filed a default notice on Sept. 12, records show. In the deed filing, the firm estimated the amount of unpaid debt on the property at $41 million.
The company was not the only alleged creditor to file claims against LiveWorkCreate in relation to the project. According to court records, several contractors filed separate lawsuits against the developer between June and October. Plaintiffs in the cases — JR Plumbing, Triple Play Electric and Bigge Crane and Rigging — all allege LiveWorkCreate has failed to pay its bills.
The foreclosure adds to the list of distressed multifamily properties in Los Angeles. Texas firm TPG Capital recently took possession of the planned site of a 176-unit multifamily complex near Playa del Rey after developer Sandstone defaulted on a $57.5 million construction loan. Last month Axos Bank claimed default on a 132-unit assisted living facility in Van Nuys.