By Kate King and Paul Kiernan

A graffiti-covered property that towers over downtown Los Angeles is poised for rebirth, after its largest creditors agreed to buy the notoriously stalled project out of bankruptcy.

Work at the site stalled in 2019, when the former Chinese owner ran into financial trouble after pouring more than $1 billion into the residential, hotel and retail development.

The three buildings attracted global attention two years ago when base jumpers and copper thieves began breaking in and graffiti artists tagged the vacant condos' large windows.

Now, a joint venture between KPC Group and Lendlease, the project's original contractor, has reached a deal to acquire the Oceanwide Plaza complex for $470 million. The venture is expected to spend another $800 million to complete it.

The new owners are betting that the coming World Cup and Olympic Games will spur a recovery in Los Angeles's battered downtown.

"Oceanwide Plaza is structurally sound and substantially complete, which gives us a real opportunity to move quickly," said John Petty, director of real estate and construction for the California-based KPC Group.

The colorfully spray-painted buildings, which soar up to 55 stories high, have drawn photographers and graffiti enthusiasts. But Los Angeles city officials weren't amused. They spent $3.8 million on police officers and a 14-foot-high fence to deter trespassers, according to court filings. The buildings remain covered in graffiti, however.

"Some people see it as a piece of art," said nearby resident David Garcia, who was walking past the towers on a recent evening with his fiancée and dogs. "But we don't see it like that. It's a little bit of a nuisance."

Garcia pointed to a darkened storefront where a popular restaurant recently closed. "If this had been finished, it would have been a completely different downtown area," he said, referring to Oceanwide Plaza.

KPC Group is run by Kali Pradip Chaudhuri, a former orthopaedic surgeon turned healthcare tycoon who has recently delved into real-estate development.

Downtown Los Angeles, like most urban downtowns, was hit hard by the pandemic. Office vacancy remains near record-high levels, and other setbacks have followed: Last January's wildfires didn't directly damage downtown but hurt sales at local businesses. And clashes between law-enforcement officers and demonstrators last summer over immigration raids in Los Angeles reduced foot traffic.

"It was a little bit of one battle after another," said Nick Griffin, executive vice president of the DTLA Alliance, a coalition of property owners in the Downtown Center district.

Now, Griffin said there are hopeful signs that downtown's recovery is under way. The apartment occupancy rate has been holding steady, at nearly 91%, after falling to a low of 82% in 2020. Several apartment buildings and dozens of retail businesses and restaurants opened in the neighborhood last year.

Los Angeles is set to host several major sporting events over the next three years, starting this summer with the World Cup, followed by the Super Bowl, then the 2028 Summer Olympics.

The DTLA Alliance and other community organizations want to spruce up the neighborhood in anticipation of those events, Griffin said. The groups have doubled up on security patrols and increased maintenance through efforts such as painting sidewalk curbs and utility boxes and hanging string lights.

The Oceanwide Plaza project began with fanfare in 2015, when the Chinese conglomerate Oceanwide Holdings acquired the site as part of a Chinese real-estate buying spree across the U.S. The companies largely retreated a few years later after Beijing pressured them to reduce their exposure abroad. Work at the site ground to a halt just before the pandemic hit.

Michael Eziobi, a 28-year-old video editor who lives in downtown Los Angeles, said the towers turned him off renting an apartment in a nearby building in 2020.

"It's essentially an eyesore," he said.

A bankruptcy hearing to wrap up the towers' purchase is scheduled for April. The venture plans to finish most of the roughly half-finished trio of skyscrapers in time for the 2028 Olympics, according to KPC Group.

The buyers have agreed, as a condition of the deal, to obtain financing of up to $800 million to finish the property's construction, according to court filings.

Griffin thinks the hotel will likely be finished first because it is closest to being done. The project's retail could also be completed for use during the Olympics and repositioned afterward, he said. The residential component will take longer, since it was built as large units for international investors, a market that has since dried up.

Angel Zuñiga, manager of the popular Mexican restaurant Sonoritas near Oceanwide Plaza, bemoaned the impact of the empty complex on local businesses. His restaurant was nearly empty on a recent Friday evening.

The graffiting of the towers sparked a broader vandalism problem in the area, Zuñiga said. Sonorita's facade, previously decorated in a Mexican mural, was tagged repeatedly until the owners eventually painted over the entire wall.

"I would say it did affect the whole area, not just that corner," he said of the buildings' abandonment.

Write to Kate King at kate.king@wsj.com and Paul Kiernan at paul.kiernan@wsj.com

(END) Dow Jones Newswires

March 02, 2026 20:00 ET (01:00 GMT)

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