Redevelopment of big public housing project nears: Pico-Aliso project to generate $50 million in contracts.

A new $50 million housing project in the planning stages at the Housing Authority of the City of Los Angeles is drawing both interest and surprise from local housing contractors.

The city housing authority recently announced that the U.S. Department of Housing and Urban Development has granted $50 million to fund the rebuilding of the Pico Gardens and Aliso Apartments in Boyle Heights.

Pending redevelopment of the crime-plagued and severely overcrowded public housing project due east of downtown L.A. has work-starved L.A. real estate companies excited.

No firm dates have been set for when L.A. housing authorities will award the coveted $50 million in contracts, but the mere prospect of the work has local architects and contractors expressing interest.

"Any time you see a $50 million project in Los Angeles during this recession, that is a big deal," said Stephen Lazarian, president of Pasadena-based Crown City Construction. "If it were 1988, it wouldn't be a large project. But for 1994, I would say that it is."

Funding for large residential projects, like funding for most other types of real estate development, has been hard to come by in recent years. As such, government funding has become more important to keep local contractors busy.

Keller Construction Co. President Paul Keller said he is not aware of any other imminent L.A. project that is comparable in size to the Pico Gardens and Aliso Apartments job. Keller is presently doing a $46 million job for UCLA, but he stated that this project is the only one of this size that he is aware of. "I would venture to say that, if (the Pico Gardens and Aliso Apartments project) is something that is going to be happening, it could be the most significant public or private multi-family housing project of the entire year." "It will be one of the largest residential projects going on in town," confirmed Laurel Gillette, principal with the West Los Angeles-based architectural firm of Gillette and Associates, which has been involved with public housing projects in the past. Gillette pointed out that the scope of the project is much larger than any public housing project seen in recent years. Most other recent public housing projects have been in the 25- to 30-unit range on scattered sites throughout the city.

The Pico-Aliso housing project, by comparison, contains 574 units in clusters of dilapidated two- and three-story apartment buildings spread across 23 acres of land. The project, built some 50 years ago, presently houses nearly 2,000 low-income residents.

The local housing authority's plan is to demolish the entire Pico-Aliso village and to reconstruct all the buildings. The new Pico-Aliso village is designed to be a gated Mediterranean-style community that would resemble a "middle-class" gated community.

Another noteworthy feature of the project is that it is being carried out in the shadow of downtown Los Angeles. Gillette stated that there are few open spaces in the downtown area that would allow a development of this size.

The five-year project is expected to provide jobs for numerous residents of the Boyle Heights area, according to Santa Monica-based Morley Construction Co. Senior Vice President Terry Dooley. "A significant amount of the labor force would come from the area," he said. "It is common for projects like that to have a lot of local labor."

Dooley estimated that the project could be expected to generate well over half a million labor hours of work at the job site. L.A. housing officials said, however, that construction contractors will probably not be required to use union laborers on the Pico-Aliso project. So the pay scale of those pending jobs would likely pay far less than "prevailing wages." Prevailing wages are roughly equivalent to union scale.

The project's ripple effect on off-site labor would exceed on-site labor. As a result, the project is expected to generate, directly and indirectly, well over a million labor hours for the local economy.

"On a job of this size, it would be normal to hire 30 or 40 subcontractors, and have roughly that many materials suppliers," Dooley said. It will be an injection of energy into a lethargic construction market, he said.

Residential projects, explained Dooley, have an important ripple effect on local economies, much more than office or industrial projects. A lot of the money used for large office projects is spent overseas on materials, he said, while most money used in residential projects is spent locally.

With $40 million of the total project cost allocated for construction, the Pico Gardens and Aliso Apartments job is likely to be one of the largest housing projects, public or private, under construction in Los Angeles County when it breaks ground, local housing contractors and architects said. Presently, the L.A. housing authority expects the project to break ground in January of 1995. The other $10 million of the $50 million project is slated to go toward covering architectural, engineering and consulting costs, as well as administrative costs.

Funding for the housing project is coming from HUD and is part of a pilot program called Urban Revitalization Demonstration.

Plans for the ambitious project surprised a few housing contractors, who said they are accustomed to less-ambitious housing projects that HUD is generally known for funding. Traditionally, HUD projects have gotten low marks on aesthetics and high marks on bureaucratic intrusion in both the planning and construction phases. L.A. housing officials promised that the Pico-Aliso project would be different on both fronts.

The HUD funding program known as Urban Revitalization Demonstration is the first of its kind, and the Pico-Aliso redevelopment is one of six initial projects funded through this new program.

L.A. housing officials have argued for years that HUD's involvement in housing projects has historically made little sense. They have long claimed that they could build more suitable housing projects without HUD's involvement because they better understand the needs of the L.A. community.

The goal of the Pico-Aliso redevelopment is not simply to provide more modern housing, according to L.A. housing officials. Rather, the project is meant to help alleviate the criminal problems that plague the existing Pico-Aliso development.

Several elements of the existing housing project, such as service roads that surround the site, lend themselves to criminal activities, such as drive-by shootings. In addition, easy freeway access from certain parts of the housing projects have made drug dealing risk-free.

Hazards such as these will be taken out of the design in an attempt to reduce crime in the projects. Other architectural elements, such as flat rooftops which have made sniper-like attacks by rival gangs easy will also be taken out of the design to be replaced by raised rooftops.

If this "demonstration" project is successful, funding for more such projects in L.A. will likely come down the pipeline, said Carl Steinberg, project manager for the L.A. housing authority.

As the name states, this is a demonstration project. If it is successful, L.A. housing officials expect that a full-fledged Urban Revitalization program will be launched by HUD for distressed public housing all over the country.

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