LOS ANGELES (CN) - Billionaire Sam Zell's real estate company has been sued by the owner of a downtown Los Angeles building that demands its right to five parking spaces.
In its March 25 lawsuit in Superior Court, Flatiron Development Co. says it owns the 100-year-old property on South Broadway, on the same block as the Grand Central Market and across the street from the Bradbury Building.
The Judson C. Rives Building is listed on the National Register of Historic places, and is managed by nonparty architect David Lawrence Gray.
The 74,000-square-foot building was one of the first concrete-encased steel-frame high rises in Los Angeles, according to Gray's website, and was converted in 2007 into 60 loft units.
Flatiron says spent $8.5 on renovating the building, trusting its licensing agreement for five parking spaces on an adjoining lot purchased by Zell's company, defendant EQR - 4th & Hill.
The city Planning Department requires Flatiron to have the five spaces so its building stays up to code, the developer says.
EQR is a subsidiary of the $30 billion real estate investment trust Equity Residential, founded by Zell.
According to the complaint for breach of contract and quiet title, EQR plans to build a 33-story mixed-use commercial and residential building on South Hill Street and bought the property from co-defendant System Property Development.
Flatiron says that under the terms of the parking license agreement for the five spaces, EQR can terminate the agreement only if the license is not used for public parking or Flatiron's building is razed.
"The agreement has not terminated because the licensed area falls within the definition of a public parking facility and the current building at 351-353 South Broadway has been renovated as opposed to razed. The parking rights granted, pursuant to the agreement constitute an irrevocable license and/or an easement which is binding on EQR," the 7-page lawsuit states.
According to Flatiron, EQR has indicated it will not honor the agreement and that when System Property Development's lease terminates Flatiron will lose its right to the five spaces.
Flatiron seeks a declaration that it has a contractual right to the five spots even if the building breaks ground, and $250,000 in damages.
Flatiron and co-plaintiff 353 S. Broadway LLC are represented by Christopher Grivakes with Affeld Grivakes Zucker.
Zell's companies Equity Group Investment and Equity Residential did not immediately respond to emailed requests for comment.