There have always been two competing versions of Los Angeles. The first is the fantasy world, the LA that we see in movies and conjure up in our imagination, whether we think about the glamour of Beverly Hills and Hollywood or the seedy underbelly of Raymond Chandler and James Ellroy and David Lynch. The other side is the real world, where actual people live, and where urban development isn’t always based on grand conspiracies and crooked cops and dames with gams that don’t stop—it’s based on actual buildings, and that’s the world that you live in.
As a developer of fix-and-flip properties and residential rehab, you have to understand how this major region works, and where to invest. LA is the dominant force in Southern California, and even the vast Inland Empire is subsidiary. So when there are developments, you need to know how to react for your business, so you can know the best way to spend your hard money loan from Socotra. One of the biggest stories in recent LA history has been the revitalization of Downtown Los Angeles, epitomized this week by the opening of the Broad Museum of Modern Art.
The Eli Broad and Downtown Los Angeles
Venice has its Medicis, Omaha has its Buffett, and LA has Eli and Edye Broad. A billionaire couple, they are famous patrons of the arts, and are dedicated to building museums in the LA art district. In doing so, they have stamped not just their name into a region, but a vibrant community in what was once a dead zone.
Downtown Los Angeles (DTLA) was once best known for being basically void of anything positive, a grimy and run-down stretch with no good place to eat or shop or to go. It was Skid Row and bad transportation. LA was famously called “the city with no center.” That has changed in the last decade or so, with striking new developments anchored by the new Staples Center (home of the now-good Clippers and the always-popular Lakers).
DTLA had started to grow economically before the recession, but that came to a shuddering halt when the market crashed. Since then, construction and renovation have once again picked up, and have led the way to recovery. New condos and apartments are being built, and empty buildings are being transformed into mixed-use multi-family properties. Indeed, DTLA is expected to add nearly 100,000 units of housing over the next eight years, and just this summer a new $500 million dollar mixed-use project broke ground.
Into this comes the Broad Museum. It is not the policy of this blog to comment on the art itself, but the museum is attracting people who love contemporary art, and is one of several galleries in the area that make the LA art scene one of the hottest in the country. This is important to people in real estate, because it means that the downtown area is not just a place for residents, but a place for people to visit, and in LA, that matters.
How the Downtown LA Boom Can Impact Your Business
If you are a real estate professional in Los Angeles, the booming downtown is a blessing, even if you aren’t in multi-million dollar condos. Because when a downtown develops, so does everything around it. The tech migration to LA means that a lot more people are moving in. They need places to live, and it won’t all be downtown. Many people don’t want to live there, especially because much of the tech hub is west of the center. But they’ll want to be able to access the downtown area, since it is now one of the places to be. The rise of less expensive transportation options like Uber and Lyft make going downtown much more affordable.
The collar neighborhoods that surround DTLA, but that also provide a great place to live with their own unique environments, are going to be the hot neighborhoods coming up. If you are looking to fix-and-flip, looking at neighborhoods like Santa Monica, Hollywood, and the red-hot Silver Lake is a great way to start.
Los Angeles is a weird city in many ways. Most cities are built from the center out. LA never really had a center to begin with. But now it is blooming, and that development process will happen in an already-established city. Using your hard money loan from Socotra to fix a property so that it is tech-enabled and eco-friendly, and ready for new residents, is a great way to get in on the ground floor. LA may not be the city of dreams, but the real city, with its real developments, can help make yours come true.