For sale: Former Calif. prison site in LA County

By JACOB ADELMAN Associated Press Writer
Posted: 10/01/2009 12:24:44 PM PDT
Updated: 10/01/2009 12:24:45 PM PDT

LOS ANGELES—California threw open the doors of a former prison on Thursday to drum up bidders' interest in the largest state-owned surplus property to hit the market in several years.

The Fred C. Nelles Youth Correctional Institution, a 74-acre site in Whittier, was expected to draw some $70 million for state coffers, Department of General Services spokesman Jeffrey Young said.

The state sells a handful of properties it no longer needs each year, but the prison was the biggest to go on sale since the mid-2000s, when a corrections department facility in the Silicon Valley was sold to Cisco Systems Inc., Young said.

The state is accepting bids on the site about 13 miles southeast of Los Angeles until Nov. 20.

"It's large enough that you could create an entire community in it," Young said. "A developer could build something extraordinary."

The grassy campus that operated as a youth prison until 2004 is the current site of a 100-cell cement lockup with slit windows, dormitories, administration and church buildings. It closed after 113 years of operation.

Developer Meruelo-Maddux Properties Inc. agreed to buy the parcel for $104 million in 2006, but state officials instead chose to use the space as a prison hospital that was never built.

Other parcels on the state for-sale list include a 5,400-square-foot vacant lot near downtown Los Angeles that once contained two oil wells, and a 5.5-acre orchard in rural Humboldt County.

The General Services Department is separately eyeing the sale of higher-profile properties such as the Los Angeles Memorial Coliseum and San Francisco's Cow Palace exhibit hall to help close the state's budget deficit.

Among those properties, state legislators have only approved the sale of the Orange County Fairgrounds.

The department has also identified 17 state-owned buildings that it hopes to sell to new owners who would lease the office space back to the state.

"The state is rethinking its entire portfolio of properties," Young said. "We're rethinking what buildings we have, what we're doing with them, whether we should own them, because we're in an unprecedented financial situation and we need to raise capital."

Young said the state has often sold property it is no longer using, such as the Whittier prison site. But such large, single properties rarely come on the market in the densely populated Los Angeles area, he said.

"I think the developers would be very interested in something like that," said G.U. Krueger, an economist at research and consulting firm HousingEcon.com. "There is a potential do to a master plan with a real good mix of commercial, retail and residential."

http://www.mercurynews.com/news/ci_1346 ... ck_check=1