California Apparel News

The Los Angeles Fashion District is taking on a look that it has never seen before. When two projects in the district open their doors, the 90-block section of downtown Los Angeles will contain a major residential element for the first time since the early 1900s.

MJW Investments’ $130 million Santee Court has begun leasing the 165 rental units available through the project’s first phase of development. Anjac Fashion Buildings has leased more than half of its 37 units at the Orpheum Lofts above the historic Orpheum Theatre in the Historic Core.

The additions reflect a citywide and nationwide trend that has developers buying old, sometimes historic buildings in urban cores and turning them into apartment lofts. Fueled by a housing shortage in the suburbs and redevelopment incentives provided by the city of Los Angeles, loft living is becoming more attractive to industry workers looking for a live-work environment or just a hip industrial-finished pad.

The influx of downtown lofts came when sewing operations moved offshore or out of the Fashion District, opening up ample space in the area’s old manufacturing buildings. While several properties have been converted into showroom space, developers have been finding more profit in residential space.

“A lot of these buildings have become functionally obsolete,” said George Bachoian, who owns a 31-unit loft building at 725 S. Spring Street, just west of the Fashion District. “They’re not up to standards for office space, so turning them into living space is great for the city and building owners.”

Room and board

With a Ralphs Grocery Co. supermarket signed on to take space a few blocks to the west, residential living is finally taking shape in downtown Los Angeles, one of the last urban areas in the country to establish a residential base.

“Why now? It’s a question we’ve been asking for 20 years,” said Mark J. Weinstein, chief executive officer of Santa Monica, Calif.–based MJW Investments. “The answer is Ralphs.”

The Compton, Calif.–based supermarket chain will occupy space in the South Park area of downtown, near the Staples Center. The store is expected to open sometime in 2004. Until then, downtown residents will have to continue traveling to the Ralphs at Third Street and Vermont Avenue or visit the produce vendors at the Grand Central Market near Third Street and Broadway, said Bachoian.

But aside from a supermarket, other recent developments are making downtown living more attractive, said real estate developers. The newly opened Walt Disney Concert Hall and the Staples Center are among the latest attractions.

Weinstein is adding up to 100,000 square feet of convenience retail space to his project, starting with 45,000 square feet for the first phase, expected to open by April 2004. A national drugstore chain, a food court and an upscale bar will be part of the offerings.

When complete, Santee Court will encompass 780,000 square feet of residential space comprising 552 residential units, in addition to the 100,000 square feet of retail space. Weinstein said he hopes the project’s courtyard and open-air common areas will create “a sense of place.”

“Eventually we’ll have pockets of little communities [in Los Angeles],” Weinstein said. “All of us [loft owners] want these projects to happen. We have meetings together. It’s a team approach.”

At the Orpheum, Anjac Fashion Buildings Chief Executive Officer Steve Needleman’s live-work lofts open up to Downtown’s Historic Core, where a number of historic theaters are based and near where the city is set to undergo a massive renovation plan. The lofts sit above the Orpheum Theatre, modeled after the Paris Opera House and home to numerous entertainment events. Needleman has been offering his new tenants a limited number of tickets to theater events such as the recent Ovation Awards. Rents range from $1,680 to $2,650 per month for units from 670 to 1,820 square feet. The first residents will move in at the beginning of the year.

At Santee, leases range from $1,090 to $2,750 per month for units from 650 to 1,300 square feet.

Needleman expects to be sold out sometime during the first quarter. Weinstein is in the pre-leasing stage and has five units signed. He expects the Fashion District properties to be popular.

“It’s safer here. Kent Smith and the Fashion District [Business Improvement District] have done a great job in keeping the area clean and safe,” said Weinstein.

Wide-ranging appeal

While the developers are targeting apparel industry designers and workers, they are expecting a range of tenants.

“I was surprised that we got a lot of reverse commuters,” said Needleman. “These are physicians and others that work on the Westside but will be commuting downtown to live.”

Bachoian’s building has operated as residential space for 15 years and was one of the first loft projects in the area. He has attracted mostly graphic artists, sculptors, photographers and students. “It’s a true live/work space. Our tenants get down and dirty with their work,” he said.

Interest in the Fashion District properties is also coming from New York and other big-city transplants who miss the urban lifestyle, said Needleman.

MJW’s Dawn Garcia has also been conducting tours of Santee Court for area business owners who are considering living near their business properties.

Photographer Ted Trent has been living downtown in a loft at Sixth and Alameda streets for the past six years and fielded so many inquiries about loft living from clients and friends that he and his business partner, Ian Shen, decided to launch LoftLivingLA at www.loftlivingla.com, a Web site that provides information on all of Los Angeles’ loft properties.

“I love the fact that I can work here,” said Trent, who does photography for entertainment industry actors and actresses. “I grew up on a farm in the Midwest, and working from home was a natural thing. I had a picture of my loft on my [photography] Web site and was spending so much time answering the question, ’Where can you get a loft in L.A.?’”

Aside from location, the lofts themselves have drawn interest, said developers.

“Where else can you live in a place with polished concrete floors and these big windows?” Weinstein asked.

Among Santee Court’s features are hanging ductwork and plumbing. Some units feature steel-framed window panes saved from the original building’s framework.

Next up for Santee Court will be for-sale units that people can own rather than lease. Trent said some building owners are offering plans in which half of tenant leases are allocated toward the purchase of a unit, should it be converted to a condominium.

The loft craze is expected to continue downtown. A number of other projects are under development in other districts including the Gas Co. Lofts on Flower Street and the Little Tokyo Lofts on San Pedro Street.