Army puts property at Wilshire and Federal up for auction.

THE U.S. Army is looking for a few good ... developers.

The Army is auctioning off a prime 10-acre parcel of land at the southeast comer of Wilshire Boulevard and Federal Avenue, an area that could see a momentous amount of development activity.

The site, located in the middle of some of L.A.'s highest valued property, could fetch at least $90 million, according to industry sources familiar with the parcel.

Surrounding the Army site, the federal government is proposing some controversial projects.

The FBI wants a new 1 million-square-foot building across the San Diego (405) Freeway at the Federal Building and the U.S. Department of Veterans Affairs is preparing to develop a chunk of its campus across Wilshire Boulevard.

Homeowner and business groups have protested the developments because they believe the projects would bring the area's already congested roadways to a standstill. The groups would prefer the land be kept as open space.

"The local community has been pretty vocal about what they like and don't like in the projects across the street at the VA campus and at the Federal building," said Tony Morales, a Stanbach principal working on the auction. "We're well aware of the challenges."

All the parcels are in unincorporated portions of L.A. County, which would control what private developers could build on them. Currently they are zoned for uses such as educational facilities, a research campus or government uses.

However, the successful bidder of the Army land will probably seek out additional uses, Morales said. "A buyer or developer of that property will probably have to go through a rezoning process," he said.

Instead of a straight cash payment, developers interested in the property would have to enter into an exchange. The Army has properties in other areas of the state where the successful bidder would have to build the military new facilities.

The winning bidder will have to provide facilities--both new construction and additions to existing buildings--on government property in California at three bases, possibly including March Air Reserve Base in Riverside, according to the Army's Web site on the bidding process.

If the value of the land at Wilshire Boulevard and Federal Avenue exceeds the cost of building the Army's new facilities, then the developer would have to make a cash payment to make up the difference.

Morales said even though the land is being sold through an auction process, the Army is looking for a developer who will work with the community on whatever is built at the site.

"Our goal is to really explore the various uses and promote a responsible development in the area," he said. "We want a buyer who will do a responsible development, and not just try to maximize density and squeeze the most value out of the property."

Staff reporter Andy Fixmer can be reached by phone at [phone], ext. 263, or by email at [e-mail].