Regarding the parking, wouldn't a NEW building have the same issue? A parking garage next to a new building, doesn't cost any more than the same garage next to an old one.
Is the difference that a new building could be larger, and thus could spread the cost of the garage over more rentable square footage?
This building can be restored, but it may require a public investment to justify what market economics can't. Personally, I'd rather spend $2mm of public money to give to an investor to make this deal work, than spend it on a surburban-style Seafood restaurant in LaVilla that was doomed from the start.
The thing is, given the current economy, even if the plan made sense on paper, the banks likely won't lend the money. That may change eventually, but will the buildings continue to deteriorate? Are they in 'stop-loss' condition currently? I seriously doubt it.