South Korean firm unveils plans to put its stamp on L.A. skyline

The aging Wilshire Grand hotel and adjoining offices in downtown Los Angeles would be demolished and replaced with a $1-billion hotel, office and retail complex under a plan by one of South Korea's largest business conglomerates.

The proposal is unexpected at a time when builders are backing away from big projects, and when the market for office space and condominiums has softened considerably because of the recession.

At 1.8 million square feet, the project is also a testament to the rising clout of L.A.'s Korean community, the largest outside of Seoul.

"This will be an icon of the Korean community for Los Angeles," said Yang Ho Cho, the chairman of Korean Air, which is developing the project.

Korean Air is the flagship company for Hanjin Group, which has $20 billion in annual revenue from its interests in land, sea and air transportation as well as construction, heavy industry, finance and information services.

Hanjin's involvement raises the project to a new level, marking the first time that a South Korean developer has engaged in an endeavor of this magnitude. The move is particularly significant because the company is what South Koreans call a chaebol, one of the family-owned conglomerates that dominate the nation's economy.

"This is on a bigger scale and it shows the growing clout" of Korean and Korean American investors, said Kyeyoung Park, associate professor of anthropology at UCLA's Center for Korean Studies.

We should applaud this form of true “stimulus”, private capital investing in an American market. The fact that it is a South Korean company should not be disconcerting to us, unless you also believe South Koreans should be concerned when an American company makes a major investment there.

The proposal is unexpected at a time when builders are backing away from big projects, and when the market for office space and condominiums has softened considerably because of the recession.

This is a typical reporter ignorance mistake. A little understanding about the subject of your story is expected.

Builders are not backing away from big projects. On the contrary, builders are aggressively whoring themselves out to get what little work is out there. Commercial construction will never be this cheap again. "Builders" are bidding projects at cost. For many in the construction industry it's either go out of business now or go out of business later.

Securing the work gives you a chance to weather the storm. If there are investors out there with the money to spend on the construction and financing, and can pay the mortgage while the economy recovers, commercial real estate and construction is a good place to invest money.

However, there will be no quick returns anymore as the days of building cheap, leasing and flipping are over. You must have piles of money and be in it for the long haul. Those that can will reap huge rewards in about 5 to 7 years (I predict).

Those of us trying to scrape steel, bricks and mortar together hoping for 2% profits will just keep hoping that more billionaires find our shining red lights.

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