The evidence is everywhere. Downtown L.A. is growing fast.
Gleaming new high-rises, like the 56-story, 684-unit Thea at Metropolis on 8th Street and the 35-story, 450-unit Perla on Broadway command the kind of rents previously associated with luxury buildings in Santa Monica or West L.A. Stores and restaurants, including the bustling Grand Central Market, now stay busy well into the evening. Construction cranes are at work everywhere from Chinatown to the Arts District.
But while real estate watchers and Angelenos have been remarking on Downtown L.A.’s residential rise for years, a new analysis from StorageCafe and Yardi, helps put the explosive growth into national context: Over roughly the past 10 years, Downtown L.A. added more residential units than any other American city’s downtown except Atlanta’s.
It’s a data point that also puts L.A. at the center of a growing Covid-era trend, where cities around the country are increasingly grappling with the future of downtown office landscapes that may or may not be forever thinned by work from home culture.
“Every major city around the country has been working towards revamping its urban core to house more residents,” StorageCafe said in a release.
StorageCafe’s measurement began in 2013; from then through 2022 the analysis found Downtown L.A. added about 19,300 residential units — a figure that amounted to a 46% increase of the neighborhood’s apartment inventory.
StorageCafe and Yardi found another 900 DTLA apartments under construction and an additional 4,700 in the pipeline. The report tracked units, not projects, but a recent report from the Downtown Center Business Improvement District (DCBID) said that it was tracking 43 residential and commercial projects in construction and another 130 in the pipeline. It also struck a similarly sunny tone.
“The number of projects that are either proposed or under construction in Downtown L.A. is pretty significant,” Nick Griffin, executive director of the DCBID, told the L.A. Daily News. “We see a steady flow in the coming years.”
It’s a construction boom that’s changed the neighborhood in myriad ways, including with higher rents: for the fourth quarter of 2021, according to the DCBID report, the average DTLA apartment rental was $2,800, up from $2,400 at the end of 2020, and occupancy was 94%. Rents for lofts in one new luxury building, the recently remodeled historic Singer Building in the Fashion District, stretch above $10,000.
“Up until the pandemic, things were rocking and rolling,” Mark Tarczynski, a Colliers broker who specializes in downtown redevelopment properties, said late last year. “And I will say that it’s poised to come back.”
Downtown L.A.’s residential construction has also been uneven, per the StorageCafe analysis. From 2013 to 2017 apartment deliveries in the neighborhood grew every year, from under 900 to nearly 3,500, but in 2018 the figure dropped below 2,000. 2019 was another banner year, with nearly 3,900 units coming into the market, before 2020 — and then especially 2021 — saw big drops.
Atlanta, the city whose downtown saw the biggest increase, gained about 21,500 units over the decade. Houston, which had the third most, added 15,600, and Charlotte added 12,800. San Diego and San Jose also cracked the top 20.
The post Report: DTLA is second fastest growing downtown apartment market appeared first on The Real Deal Los Angeles.
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