Jeff Gerlach

West Adams, the mid-city neighborhood in Los Angeles below the 10 freeway, has hit a recent growth spurt. The market has slowly attracted homebuyers migrating from more established markets in search of affordable price tags, but in the last 12 months, several new developments projects have sprung up. Now the market is on its way to become a city hotspot with retail, hotels, creative office and apartments.

"West Adams has been seeing significant change over the past 12 months – most easily visualized by the numerous development projects underway and future-marked development sites," Jeff Gerlach, a senior associate at CBRE, tells GlobeSt.com. "There are over 30 development sites along West Adams, of which at least 25 are under construction.  When completed, West Adams will boast over 100,000 square feet of pedestrian-friendly retail, hundreds of apartment units, two boutique hotels and two new 30,000 square-foot creative office buildings."

The opportunity zone model has helped to jumpstart the market. :West Adams sits in an opportunity zone, which has made it very attractive to developers looking to capitalize on those credits," says Gerlach. "Major development groups including CIM Group, Carmel Partners, 4D Developments and Redcar Properties all have projects underway.  In addition to opportunity zone incentives, West Adams is benefiting from record-high rental rates in nearby Culver City and incredibly low vacancies, which has helped it to become a great alternative for companies looking for space.  Recent major tenant migrations to the West Adams area have included Sweetgreen's corporate headquarters, Goat -a sneaker reseller—and the RealReal. All of them have signed leases for over 30,000 square feet."

This is likely just the start for the market, and Gerlach expects to see more investment in the area, not only because of the opportunity zone benefits but also because the market has a lot of upside potential. "I think there is only upside for West Adams.  As developments complete and the area continues to take shape, rental rates and housing prices will inevitably increase," he says. "The West Adams submarket is relatively small, which limits the availability of product, which I believe will further increase demand and investments."

For developers, projects tend to be smaller than those on the adjacent Westside, and are more curated and manageable, creating more opportunity. "Rather than building large, full city-block developments, most of the developers are taking a tasteful approach of smaller, more curated projects, which should help keep the charm and culture of West Adams alive," says Gerlach. "Most all developments have significant retail components, and I believe the future of the area will be largely retail focused, similar to Abbot Kinney or Highland Park. Popular restaurants Alta, Mizlala and Mian have already moved into the neighborhood."

As a result, the neighborhood is often compared to coveted boutique neighborhoods like Abbott Kinney and Highland Park. "As the submarket continues to take shape, we will continue to see increased foot traffic, more restaurants, coffee shops and retail stores and a more robust community as the additional apartment, hotel and office projects come online," says Gerlach.