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The Ratkovich Company in the News SEIZING THE MOMENT Developer Wayne Ratkovich, one of downtown L.A.'s key visionaries, sees the time as ripe for urban renewal Real Estate Journal - Mar 25, 2002 By Michael Gottlieb, CREJ Assignment Editor The sight of limousines waiting to unload passengers at a high-end restaurant on downtown Los Angeles' Olive Street in the early 1980s was nothing short of a revelation for a long-ignored city core. At the heart of the commotion was Wayne Ratkovich, president of The Ratkovich Co., who was heralded for having the guts and the vision to buy the 13-story James Oviatt Building for $400,000 in 1977. Rather than demolishing the Art Deco classic to build yet another parking lot, he defied contemporary logic by investing $5 million to restore the building and open one of the most expensive restaurants in the country on the ground floor. He sold it six years later for more than $13 million. Many viewed the Oviatt's success as a turning point for downtown Los Angeles. and credit Ratkovich with spearheading the central business district's subsequent. The 1980s were high-flying times for downtown Los Angeles as hundreds of millions of dollars flowed into office high-rise construction. "Those were pretty good times in downtown Los Angeles. Unfortunately, it wasn't sustained," Ratkovich said. The 1990s found downtown with too much office space and not enough demand, as the recession forced the area back into hibernation. A lack of downtown residents exacerbated this deep sleep, as most Angelenos preferred the more suburban lifestyle of the city's Westside. That is, until now. Twenty-five years after Ratkovich first demonstrated the potential of urban Los Angeles, the combined influence of new high-profile destinations nearing completion and thousands of new residential units made the Los Angeles central business district one of the strongest office markets in the country in 2001. Most in the commercial real estate industry say it is only a matter of time before the area becomes a vibrant, truly 24-hour district. Undoubtedly, the topic will come up at this week's Urban Marketplace event, being held next door to the Oviatt at the Millennium Biltmore Hotel. Sponsored by the Urban Land Institute's Los Angeles District Council, the event will bring together a host of expert panelists to examine the challenges, solutions and opportunities inherent in mixed-use real estate development in urban Los Angeles. But ask Ratkovich, a proponent of smart growth, experienced mixed-use developer and an Urban Land Institute trustee who has chaired several national panels tackling some of the most difficult urban development challenges in Chicago, Atlanta and Washington, D.C., whether downtown Los Angeles will ever measure up to the intimate downtown environments of New York City, Boston or Chicago, and his answer once again defies contemporary logic. "The answer is probably not," he said. Ratkovich, who has developed more than 13 million square feet of space - primarily urban infill and rehabilitation projects, said Los Angeles is the ultimate post-suburban city. The concentration of property necessary to replicate the atmosphere of other major cities won't work in Los Angeles. First, there are the physical restrictions of a city built for cars. The city has very large blocks, making it tough to be rebuilt as a place that is comfortable for people to walk, he said. Creating a range of housing, particular affordable housing, is essential to developing the area, Ratkovich said. Yet, many of the new housing projects being developed target upscale executives who work downtown and may own a home elsewhere. Affordable new residential projects often rely on subsidies to pencil out. "If you are going to have sustainable development it can't be done with subsidies," he said. Ratkovich said developers must be more imaginative with affordable housing and change their mind-set to say they can make a profit developing affordable housing without subsidies. "Whoever figures it out will make a fortune, and deservedly so," he said. And as mixed-use developments are increasingly built to satisfy the need for increased density in Los Angeles, developers need to create balanced projects that adequately deal with persistent issues such as parking. "Quality lasts. Good developments will last," he said. Despite the challenges he thinks downtown Los Angeles faces in measuring up as an urban city, Ratkovich also is optimistic about downtown's potential as a regional center. He is pleased to see a wave of new investment after 20 years of hearing people say downtown is a great place to develop, but not doing so. "If there is ever a moment, this is it," he said. :: Building for the Future Community organizations have honored Ratkovich many times over the years for his development work, which has included such projects as the Oviatt, the Fine Arts Building, the Pellissier Building, Chapman Market, Ladera Center, the Irvine Technology Center and the Von Karman Corporate Center. After the Oviatt, which Ratkovich said he bought "simply because it was cheap," unaware that he had such a treasure on his hands, the development project that Ratkovich is most proud of is the rehabilitation of the Wiltern Theater in Los Angeles. When he bought the circa 1921 former Warner Brothers flagship movie house, it, too, was targeted for demolition. Ratkovich then invested $20 million to renovate the landmark, restoring it to its former glory as a cultural center combined with street-level retail and restaurants. With its mixed-use function, the Wiltern represents a step toward Ratkovich's top priority today: Completing The Alhambra, a 1 million-square-foot, mixed-use complex in Alhambra. The Ratkovich Co. purchased in November 1999 for $86.7 million from Santa Fe International. The now $100 million development is not only something that Ratkovich is proud of, but the 20-building campus reflects his belief that development can improve the quality of life in Southern California. The Alhambra serves as a tenant-focused model for growth by combining a variety of uses in one place. Although the concept is not unique, it reflects a trend of developing for the varied needs of people to improve the basic quality of life. Among the tenants at the seven-day-a-week working environment are high-end restaurants, Los Angeles County public service departments and the USC School of Medicine, along with high-tech businesses. Additional plans include building a retail center and adding commercial amenities. "Developers have to take the time to think about 'city building,' rather than project building," he said. Ratkovich expects The Alhambra to occupy much of his attention as it is built out over the next 10 years. Beyond his need to develop projects that make sense financially and regionally, by promoting smart growth, Ratkovich continues to pursue a sense of relevance, a concept that formed his decision-making since before he learned the technical aspects of development at Coldwell Banker following his graduation from UCLA in 1964. "There is this whole idea of doing something relevant and the realization that something you do has a permanent significance to the city," he said. Above all, the 60-year-old grandfather follows the advice of long-time friend and former president of the Urban Land Institute, Robert T. Nahas. The three things that matter most in life, Nahas told Ratkovich; family, business and community. "It is always important to keep those in order," Ratkovich said. "Family is the first priority, business is second, and then comes community."" ‹‹ back |