The days could be numbered for the curious, pyramid-shaped federal office building in Laguna Niguel known as “Ziggurat.”
The government on Thursday, Nov. 30, said it has put back on the market the 89-acre site highlighted by the seven-story building officially known as the Chet Holifield Federal Building.
When the General Services Administration last tried to sell the property, a prospective buyer was required to preserve the beige, million-square-foot office structure designed by famed architect William Pereira. That auction in April got zero bids, the GSA said.
“The feedback was clear” that keeping the structure was a problem for potential buyers, said Chelsey Battaglia, a GSA senior realty specialist.
So this time around, there is no preservation mandate for the structure – a decision made following the failed auction and after GSA consulted with interested city, county and state parties. This time, the bids — with the same starting price of $70 million – are due in June.
Debate all you want about the building’s aesthetics – eye-catching or eyesore. Ponder its possible historical worth or some sentimental value. But the property seems likely headed for a date with a wrecking ball.
You see, Ziggurat sits on prime South County real estate with noteworthy value if an owner has an unfettered opportunity to redevelop it. Today, office space isn’t a popular asset – especially in a building the GSA suggests needs potentially $341 million in renovations.
Roughly 20% of all Orange County office space is vacant thanks to work-from-home preferences that doubled the pre-pandemic vacancy rate.
That countywide surplus of cubicles and meeting rooms means few investors want to be office landlords. Office towers in Orange County are routinely selling for half their value. Meanwhile, other Orange County office structures are in the process of being converted to housing or demolished to make way for warehouses.
So, the GSA is wise to pursue this open sales path if it wants to profit while ridding itself of the Holifield Building, named after the longtime congressman from California. The Ziggurat housed various federal agencies in the past half-century, but now only 60% of its space is spoken for. And the 3,000 or so workers still assigned to the complex mostly work remotely.
Once the shock of the structure’s demise has passed, Laguna Niguel’s officials should realize the promise of this redevelopment opportunity in an era where land for extra housing is desperately needed.
“The city is excited to work with any future developer and we look forward to a robust community discussion about the property,” said Jonathan Orduna, Laguna Niguel’s community development director.
Plus, the new auction process tries to honor Ziggurat’s legacy.
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A buyer could pay up to $3 million in fees if they take no action to preserve the structure. Those funds would go toward helping save other local historical structures and preserve the building’s memories.
Additionally, steps will be taken to create a permanent historical record of the structure, creating a collection of pictures, drawings, paperwork and a building model.
The fact such language is in the sales literature suggests the end is near for a structure that wasn’t supposed to be a government office building in the first place.
Pereira, who died in 1985, is known for unusual-looking structures – from the spider-like building at Los Angeles International Airport’s entrance to the Transamerica Pyramid in San Francisco. His Ziggurat was supposed to be a factory and corporate offices for defense contractor Rockwell. Construction was completed in 1971, but the building went empty as cuts in US defense spending altered Rockwell’s thinking.
In 1974, the Laguna Niguel property became federal offices as Rockwell traded it for government defense plants in Los Angeles.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
