The Oceanwide Plaza project in downtown Los Angeles, nicknamed the "Graffiti Towers" due to its spray-painted exterior, has secured a bankruptcy-exit agreement with its creditors. This settlement facilitates a potential sale of the residential complex, which has been stalled since 2018 when its Chinese developers, China Oceanwide, ran out of funding after investing approximately $1.2 billion. The developers' financial troubles stemmed from Beijing's restrictions on overseas investments by Chinese firms.
The agreement resolves long-standing inter-creditor disputes and establishes a framework for a Chapter 11 plan and sale. Specifically, L.A. Downtown Investment LP will receive a $230 million claim, while mechanic's liens, including those held by Lendlease (US) Construction Inc. and DTLA Funding LLC, total $168 million. Additionally, Lendlease (US) Construction Inc. will make a $20 million payment to Chicago Title Insurance Co. to settle their disagreements.
Following the bankruptcy-exit agreement, a joint venture between KPC Group and Lendlease Corp. offered to acquire the project for $470 million. This bid was approved by a bankruptcy court in February 2026. However, the sale faced delays as the City of Los Angeles expressed concerns in May 2026 regarding the buyer's development plan, arguing it lacked a concrete path to completion and a detailed integrated program. A court decision on the matter was delayed until July 20, 2026, as the buyer worked to address the city's concerns. The project, initially envisioned as a $1.2 billion, 1.5 million-square-foot complex with condominiums and a Park Hyatt hotel, is currently 60% complete and needs substantial interior work and graffiti removal across its 27 tagged floors.
