LOS ANGELES-I knew downtown Los Angeles before it was cool. Besides growing up near the Echo Park area, I took the plunge in mid-2000 and staked a claim in Chinatown in a dumpy old condo on Grand Avenue. From there, I moved on to the Toy Factory in the Artist's District, and then became a City West resident at 1100 Wilshire.
Downtown had a magnificent buzz as condos were beginning to price as if they were in the New York market reaching the $1,000 per square foot stratosphere. Local names like Shy, Gilmore, and Needleman were creatively pushing the envelope with adaptive reuse projects because there was a CRA to help.
Today, outsiders like Equity Residential, Hanover Co., and other institutional players are either taking over broken projects or putting sticks in the ground to accommodate what seems to be an insatiable demand for housing. Developer Geoff Palmer has given new meaning to “Little Italy” with all of his mega residential projects throughout the city …. and he continues to build.
Forest City's Blossom Plaza in Chinatown, a storied project that expects 240 rental units, retail, and a bridge to the Metro Gold Line light rail system, is finally going to happen with a $5-million boost from the Affordable Housing Trust Fund. The buzz is back, but with a cautious tone.
According to local paper Los Angeles Downtown News, there are 85 different projects in some stage of development. Most that were originally envisioned as condo projects have quietly become rentals with the hope of reverting when the market recovers. Overall, there is limited condo stock available for sale. The cost to build exceeds return hurdles and as a result there are only a few for-sale projects on the books. Major projects like Farmer's Field and the 72-story Wilshire Grand Hotel by Korean Airlines are coming and will continue to build up the area.
Downtown Los Angeles has a long way to go, especially with its infrastructure, but it's heading in the right direction. More opportunities will become available for the increasing amount of people who are ready to transition out of rentals and into ownership in the very near future.
Marcelo Bermúdez is president of Figueroa Capital Group, a subsidiary of Charles Dunn Co. The views expressed in this column are the author's own.
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