Southern California hospital operator and hotelier Dr. Kali P. Chaudhuri’s KPC Development is looking to join with Lendlease in a bid for downtown Los Angeles’ stalled, mega-development Oceanwide Plaza, federal bankruptcy court documents reveal — but things are far from over.
KPC would join Lendlease, one-time general contractor for the project, in a credit bid of $470 million.
There is a bigger and all-cash offer on the table: a partnership between an overseas investor and Cityview, helmed by Sean Burton, according to a person familiar with the matter.
Cityview did not immediately respond to requests for comment.
Chaudhuri’s company and Lendlease filed an initial purchase agreement for the development located in the heart of downtown, the L.A. Times reported earlier today. It’s generally a credit bid, which was expected, as The Real Deal previously reported.
KPC comes to the deal through its control of another major Oceanwide creditor, LA Downtown Investment. The company bought LADI’s debt, according to the person familiar.
A recent agreement indicated LADI, funded by EB-5 investors, is entitled to a $230-million claim, and Lendlease, about $169 million.
The likelihood of an all-cash offer from a respected Los Angeles developer aside, the court needs to approve the sale, and then the work begins. The unfinished, three tower development covered in graffiti, has been stalled for years after its Beijing-based developer ran out of money after putting more than a billion dollars into vision of a mixed-use project — and another $1 billion is expected to be needed to complete the development, which was set to include office, retail, hotel and residential components. KPC and Lendlease could bid their debt, but they still need money to move it.
Chaudhuri has been shopping construction loans but hasn’t found a taker, the source said.
A representative for KPC Development did not immediately respond to a request for comment; neither did an attorney for the debtor.
Chaudhuri’s KPC is building a $300-million hotel next to SoFi Stadium in Inglewood. Since the early 2000s, he has had a reputation as a controversial medical entrepreneur after his company, KPC Medical Management, went bankrupt and left hundreds of thousands of patients without care.
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