Smedra/garcia/16″/cw1st/mark2nd By SHELLY GARCIA Staff Reporter Ira Smedra, the controversial L.A. developer behind the Village Center Westwood project, is in escrow to acquire the largest single parcel of land in North Hollywood’s long-depressed Valley Plaza shopping center, according to local real estate sources. The 5.6-acre parcel, the site of a J.C. Penney store that has been closed since the Northridge earthquake in 1994, is among some 30 individually owned sites in the center. Alone, it is probably not enough to give Valley Plaza, located at Victory and Laurel Canyon boulevards, a badly needed facelift, but brokers said it could help jump-start a neighborhood that’s long been neglected. “What he’ll do is, he’ll bring some energy to it,” said Mathew May, a partner with Madison Partners in Santa Monica, who tried several years ago to arrange a redevelopment deal for the center. “There’s plenty of tenants that want to be in the marketplace.” Smedra denied reports that his company, Arba Group, is in escrow to acquire the Penney property. However, other sources close to the project say that a sale is imminent, and that Smedra plans to demolish the Penney building and redevelop it for big-box retailing or entertainment uses. In a letter obtained by the Business Journal that was written to one potential client, L.A. Fitness, Encino attorney Wayne Avrashow stated that he has spoken with Arba Group and the company expects to close escrow on the site in January. “They (the Arba Group) are very receptive to receiving offers to lease on the site, subject to their acquisition,” the letter, dated Oct. 9, 1998, states. Avrashow did not return phone calls. L.A. Fitness Chief Financial Officer Paul Norris confirmed that the company is exploring the possibility of opening a 40,000- to 45,000-square-foot health club on the site, but he cautioned that no decisions have been made. “We’re actively working on 30 different locations,” Norris said. Other sources said Smedra is trying to assemble additional parcels adjacent to the J.C. Penney store. Some speculated that Smedra has been unwilling to discuss his project publicly because he fears it might hurt his bargaining power with the other property owners. Others said the developer, who is known for playing hardball with community groups and city agencies that have opposed his projects in the past, has kept his plans close to the vest because other developments have drawn so much controversy. Smedra’s planned $100 million entertainment and retail development in Westwood has been tied up for more than two years, in part because community groups have vehemently opposed the project. Valley Plaza, one of the first shopping centers in the country, is a collection of individually owned parcels of land, unlike today’s malls that are owned by a single company. That means a developer would have to secure individual agreements with each of the owners in order to overhaul the property. That has been difficult, brokers said, because the owners have unrealistic expectations about the value of their property. “The problem is, how do you get these people together with a number that makes sense?” said May. He said he has worked with several developers who have given up trying to assemble the parcel in the past. “If it were easy, it would have been done two or three years ago,” he added. The recent success of a newly refurbished Sears store in the center and a Smart & Final, which moved in about a year ago, is evidence of the center’s potential, brokers said. The center is located adjacent to the Hollywood Freeway (170), and it has a movie theater on the premises. The problem is that most of the other stores are small, mom-and-pop operations that are now in their third generation of ownership. They have not been well maintained and have fallen out of favor with today’s tastes and shopping patterns. “No one kept it current, and people just lost interest and started going to new centers,” Norris said. Mary Roberts, a broker with Anchor Management, the on-site management company for the center, said her group has been working with the different property owners for three years to assemble the parcel. Smedra came close to succeeding some months ago, but dropped the talks, others said. His efforts are currently centered on assembling a smaller parcel at the south side of the center.
