Arts District Is Not South Park

LOS ANGELES—The center of the development boom in Downtown Los Angeles—the L.A. submarket that has seen the bulk of new construction projects—has moved from South Park to the Arts District. Plenty of major developers, most recently Onni Group from Vancouver, have projects planned in the submarket; however, they are finding a much different entitlement process, namely a more difficult one, than in the South Park neighborhood.

Much of the entitlement woes in the Arts District are due to zoning constraints left over from when the neighborhood was an industrial area. “Differing from South Park and other neighborhoods of Downtown, the Arts District is zoned industrial,” Brandon Gill, a broker at CBRE, tells GlobeSt.com. “There was a hybrid industrial ordinance that was passed and then it was opposed, so it never was effectuated. The one thing that is a challenge in this neighborhood was getting through entitlements. It is a bit more challenging than it is in the South Park area where the zoning is by right. In South Park, developers are able to get a greater density. That potential is there in the Arts District, so it is going to be interesting to see what these groups do on these sites and if the city is going to work with these developers. If there was ever an area of L.A. to do density, it is in Downtown.”

Gill represented Core Development in the recent disposition of a development site in the Arts District to Onni Group, a Vancouver, Canada-based developer that has been highly active in other Downtown Los Angeles neighborhoods. Although the entitlement process is more challenging, Gill says that larger developers are taking on opportunities in the market. “I think that groups that have developed in other parts of the country understand that these types of projects take a level of expertise and some bandwidth,” he says. “It is kind of exciting to see some firms that aren't local and appreciate the goal of doing a significant project that is not only functional but also visually impressive.”

One reason that Gill believes that the market is attracting marquee developers is because they understand the city, which has some history but is still very young. “The City of Los Angeles is not that old, and downtown is not that old,” he adds. “There is something unique about Downtown and there is history in Downtown, and that draws these groups into these neighborhoods. It is nice to see new development that is going to be thoughtful and creative as well as responsible.”

LOS ANGELES—The center of the development boom in Downtown Los Angeles—the L.A. submarket that has seen the bulk of new construction projects—has moved from South Park to the Arts District. Plenty of major developers, most recently Onni Group from Vancouver, have projects planned in the submarket; however, they are finding a much different entitlement process, namely a more difficult one, than in the South Park neighborhood.

Much of the entitlement woes in the Arts District are due to zoning constraints left over from when the neighborhood was an industrial area. “Differing from South Park and other neighborhoods of Downtown, the Arts District is zoned industrial,” Brandon Gill, a broker at CBRE, tells GlobeSt.com. “There was a hybrid industrial ordinance that was passed and then it was opposed, so it never was effectuated. The one thing that is a challenge in this neighborhood was getting through entitlements. It is a bit more challenging than it is in the South Park area where the zoning is by right. In South Park, developers are able to get a greater density. That potential is there in the Arts District, so it is going to be interesting to see what these groups do on these sites and if the city is going to work with these developers. If there was ever an area of L.A. to do density, it is in Downtown.”

Gill represented Core Development in the recent disposition of a development site in the Arts District to Onni Group, a Vancouver, Canada-based developer that has been highly active in other Downtown Los Angeles neighborhoods. Although the entitlement process is more challenging, Gill says that larger developers are taking on opportunities in the market. “I think that groups that have developed in other parts of the country understand that these types of projects take a level of expertise and some bandwidth,” he says. “It is kind of exciting to see some firms that aren't local and appreciate the goal of doing a significant project that is not only functional but also visually impressive.”

One reason that Gill believes that the market is attracting marquee developers is because they understand the city, which has some history but is still very young. “The City of Los Angeles is not that old, and downtown is not that old,” he adds. “There is something unique about Downtown and there is history in Downtown, and that draws these groups into these neighborhoods. It is nice to see new development that is going to be thoughtful and creative as well as responsible.”