Loft Developers Expand in Fashion District
A new wave of loft construction is underway in and around the Los Angeles Fashion District, but developers fearing rising interest rates appear to be moving back to building rentals rather than condominiums.
“There’s some uncertainty about the condo market, and rentals remain strong,” said Los Angeles–based architect David Gray, who is designing and building four projects in the downtown market.
When developers such as Santa Monica, Calif.–based MJW Investments launched projects such as Santee Village about three years ago, they were almost exclusively building rental units to take advantage of rising rates and investment opportunities, but as prices continued upward and interest rates remained at record lows, condominiums started cropping up. Now it’s turning again, said Gray.
Despite these factors and a movement to preserve Los Angeles’ industrial core, loft development continues strong. Developers have been renovating vacant factories and other manufacturing space to answer the call for a housing shortage, yet a debate is progressing on how much industrial space should be converted to housing.
In the meantime, many fashion industry workers continue to embrace the new housing opportunities near their workplaces. Lofts, they said, are hip, close to work and can even serve as live-work space. As a result, many have sold out within weeks of opening. Now, another wave of construction is under way.
The latest entry comes via The Chapman, an historic downtown Los Angeles Theater District building located at 756 S. Broadway, one block from the Fashion District and its main wholesale buildings.
The building’s developer, Heritage Group Development, recently opened sales and announced a summer occupancy date. The 13- story building contains 168 for-sale units, ranging from 600 to 1,300 square feet. Amenities and features include a restored lobby, rooftop gardens and ground-floor retail space. The units will feature exposed brick walls and original oversize windows.
Gray is developing a 38-unit rental project at 308 E. Ninth St. at the corner of Ninth and Santee. Fashion District workers know the building because it houses the area’s only Starbucks Coffee outlet. Gray has entitlements from the city and will soon start construction on the five-story building, expected to open during the third quarter of 2008. The building will house several two-story rooftop penthouses. Units will average 1,100 square feet.
Gray is also part of the team developing the former Great Republic Insurance building at 756 S. Spring St., where 72 condominiums are set to open during the second or third quarter of 2008, and a 92-unit rental project across the street at 810 S. Spring St. That project is supposed to open by the end of the year and will feature 60 units. He’s also working on projects further up on Broadway in the 400 block.
For most of these projects, he’s incorporating courtyards, rooftop gardens and pop-up skylights. “A lot of these buildings offer great views of downtown, so you have to take advantage of that,” he said.—Robert McAllister
