Blair Besten halts her stride down 7th Street, stopping in front of an empty storefront. Once upon a time, before the pandemic, it was a vintage-clothing shop. She’s about to tell a story about it when suddenly a bright-red engine from Station No. 9, based in Skid Row, comes barreling down the street, siren blaring. “We get that all the time,” Besten says as the truck passes, alluding to the staggering toll from the winter coronavirus surge.
Besten is executive director of the Historic Core Business Improvement District, representing the 56-block downtown neighborhood filled with early-twentieth-century buildings like the Eastern Columbia, a turquoise Art Deco edifice on Broadway that underwent a $30 million transformation and reopened as lofts in 2007, part of a decades-long wave of reinvestment and development that utterly transformed downtown L.A.—at least until COVID-19 came to town.
For an hour on a crisp January morning, Besten and I traverse sidewalks that feel about 30 percent as crowded as they did a year ago. The quiet feels alien; I spent the better part of two decades as editor of the Los Angeles Downtown News and grew habituated to clogged sidewalks, near-constant construction, and an unending stream of store and restaurant openings. Now the economic wreckage unleashed by COVID is inescapable, if also oddly random, the blocks a patchwork of closed businesses and those that persevere. We stop in at the Bohemian House of Espresso & Chai, where the menu includes a camel milk cortado, and discuss Big Man Bakes, the cupcake spot Chip Brown opened nearby at 4th and Main in 2009; its six-foot-five proprietor and namesake parked himself in front all night during the spring Black Lives Matter protests to deter opportunistic looters. On 5th Street, Besten points to a pair of husks that, pre-pandemic, held the Mexican restaurant Coronados and the New Orleans-flavored nightspot Little Easy. The randomness of the devastation is jarring; over in the Spring Arcade, Le Macaron and Downtown Donuts have closed while RiceBox and Garçons de Café carry on.
“What was great about this neighborhood was that we had people who lived here long enough to fall in love with it, and then decided to start their dream business here,” Besten says. “We need to find a way to encourage those people to return, or new people to come and take their place.”
No part of Los Angeles has been impacted more by COVID than downtown. For the past two decades, it experienced an urban metamorphosis driven by building what was essentially a private-sector-financed satellite downtown around Staples Center and L.A. Live. Spectacular growth in residential, cultural, culinary, retail, hospitality, and nightlife sectors followed, boosting downtown’s residential population from about 18,000 to 85,000.
But all of it came to a screeching halt on March 15, 2020, when Mayor Eric Garcetti issued the executive order shuttering restaurants, bars, theaters, and many other businesses integral to downtown’s renaissance. Four days later, the Safer at Home directive landed, and Los Angeles was effectively locked down. Literally overnight, a hefty percentage of the approximately 500,000 people who work downtown and live elsewhere stopped their daily commutes. The office towers emptied, and a year later, amid a molasses-slow vaccine rollout, the skyscrapers are only about ten percent filled on any given day.
“The pandemic really put into focus that, boy oh boy, this is a heavily dependent office-worker environment, where if you remove the approximately half-million workers, there’s not a lot of folks feeding the daily retail,” says Derrick Moore, a senior vice president at the brokerage firm CBRE, who since 1999 has executed north of 500 restaurant, store, and other commercial leases in downtown alone.
Virtually every downtown economic engine has been shut down. The Lakers, Clippers, and Kings play at Staples Center without fans, a loss of 19,000 patrons who normally would linger in nearby bars and restaurants before and after games. Museums and live-music venues, from Walt Disney Concert Hall, itself an anchor tenant in downtown’s rehabilitation, to the ragtag, all-ages Main Street club the Smell, remain closed. The Convention Center calendar has been gutted, and along with it the expense-account attendees who once filled thousands of nearby hotel rooms.
“We don’t have the tourists roaming the streets near the Convention Center, walking to their hotels,” observes Jessica Lall, president and CEO of the advocacy and lobbying group the Central City Association.
Then there is the most salient change: the number of tents on the sidewalks has exploded, evidence of an unrelenting humanitarian crisis now impossible to ignore. The effort to rein in homelessness in downtown is a decades-long tug-of-war, and without constant foot traffic serving as a deterrent—and the Centers for Disease Control early in the pandemic urging that homeless individuals not be forced to pack up and move their belongings each day—the encampments have grown unabated.
“General” Jeff Page, a Skid Row activist for 15 years, says some of the spread is driven by the same instincts exhibited by millions of housed Angelenos: Skid Row denizens have sought to social distance by leaving their crowded, impoverished community. The Reverend Andy Bales, president and CEO of Union Rescue Mission, said the threat of the coronavirus forced Skid Row shelters to “decompress” their residential base by a half to two-thirds, pushing many onto the streets of downtown.
“People say, ‘I don’t want to live in a tent and an encampment next to other people; I have to find my own block.’ So they migrate into areas not normally known for homelessness,” Page says.
The homeless population swelled further as inmates held at downtown’s Men’s Central Jail and other facilities were released early in another effort to stanch COVID, though often without much concern as to where they would go. Add to those the housed whose incomes cratered during the pandemic—a February report by the Los Angeles Economic Development Corporation estimates that 20,000 L.A. County residents became homeless between February and November last year. Large encampments have sprouted in places where they never before existed, such as the plaza on First and San Pedro streets in Little Tokyo and an underpass north of the Bonaventure Hotel on Figueroa Street. The situation has sparked existential dread from even some of downtown’s most ardent boosters.
“It fuckin’ sucks—but it’s getting better,” says Hal Bastian, executive vice president of the real estate brokerage firm Major Properties, who for more than a quarter century has lured businesses to downtown. Adds Chris Rising, the cofounder and CEO of Rising Realty Partners, which has invested in turnarounds of downtown properties such as the PacMutual and the CalEdison buildings, “The quality of life is significantly poorer right now. I used to walk all around downtown, and I’m not feeling comfortable doing that. I think we have to be realists and say to our city government, ‘This isn’t acceptable.’ We’re not going to get people coming back unless they feel safe and unless we address these quality-of-life issues.”
Downtown’s spectacular growth came to a screeching halt on March 15, 2020.
Meanwhile, the pandemic has ignited an existential debate about the very viability of downtown. On one side are those who assert that the state of the streets, combined with the rise of Zoom and walk-down-the-hall commutes, will undermine the base of office workers that drives the community, and this in turn will reverse the momentum that drew hip restaurateurs and propelled Gen Xers and millennials to pay $4 a square foot for apartments. On the other side is the recognition that downtown has been badly damaged—that it will take at least two years to fill the vacancies—but that it has rallied more than once, and ultimately COVID, like the Great Recession, will be just another high hurdle to clear. Ongoing construction and an influx of new businesses, including Warner Music Group and Spotify in the Arts District, are cited as casual evidence that downtown is already on the rebound.
“Rumors about the death of downtown are vastly exaggerated,” says Dan Rosenfeld, whose decades of work in the community range from developing skyscrapers on Bunker Hill to propelling neighborhood-oriented growth through the nonprofit Community Partners. “I think downtown L.A. is more well-positioned than any office market for a new world,” adds Rising. “If we are in a new world, where you’re only going to come into the office a couple days a week, why wouldn’t you go to downtown L.A.? It’s got a transportation system geared around it.”
The mayor, unsurprisingly, counts himself among the optimists. “I think it’s going to go from zombie town to party town,” Garcetti told me in February. Acknowledging that much work needs to be done, from zoning changes to waiving fees for business owners, the mayor believes downtown is uniquely disposed to recovery. “I think it’s going to be a place that goes from empty office buildings to some of the most competitive, class-A office buildings on the West Coast. The fundamentals are so strong.”
If there is an overarching truth about downtown, it’s that two conflicting realities define it simultaneously: a once-bedraggled city core reclaimed and reactivated, and a heartbreaking display of civic failure and a devastating portrait of what happens when the nation’s second-biggest city, with conspicuous wealth, chokes on the mission to provide sustainable housing for all its residents.
To apprehend the future of downtown, a refresher on its past is in order. The historic heart of Los Angeles—bordered roughly by the 101, 110, and 10 freeways on the north, west, and south, respectively, and the Los Angeles River on the east—boomed early in the twentieth century as a nightlife magnet with movie palaces like Sid Grauman’s Million Dollar Theatre on Broadway, with its fantastical bas relief gargoyles; decades later, it would become one of the first downtown commercial buildings converted to residential use. Downtown faded in the middle of the century as the city sprawled and businesses relocated to Beverly Hills and Century City. In the 1980s, then-mayor Tom Bradley utilized the Community Redevelopment Agency as an enticement to developers to erect steel-and-glass towers where crumbling Victorian houses once stood on Bunker Hill. The office sector expanded—and downtown L.A.’s skyline was suddenly dominated by skyscrapers like the 72-story U.S. Bank Tower, which long stood as the tallest building west of the Mississippi until it was eclipsed by the Korean Air–owned Wilshire Grand Center in 2017; the Gas Company Tower overlooking the Millennium Biltmore Hotel; and the high-rise now known as FourFortyFour South Flower, made famous in L.A. Law’s opening credits. But the new glass-and-steel downtown—abutting its low-rise, 1920s-vintage, stone-and-masonry counterparts like the Los Angeles Times building—remained essentially a 9-to-5 zone, with nightlife mostly limited to performances at the fortress-like Music Center, opened in 1964 as a West Coast response to New York City’s Lincoln Center.
The passage of the Adaptive Reuse Ordinance in 1999 made it easier and cheaper for developers to turn dead office buildings into housing, with city government oversight to make sure the program was effectively implemented. It worked. I remember meeting a gregarious real estate developer named Tom Gilmore at the then-sketchy corner of 4th and Main. Gilmore pointed to a trio of buildings he had just purchased and planned to turn into loft-style apartments. “People say the neighborhood sucks,” Gilmore told me. “I just bought the neighborhood.”
The early housing rush coincided with the arrival of tentpole public facilities like Staples Center in 1999 and Disney Hall in 2003. The first wafts of hip development were led by the Standard Hotel, which in 2002 turned the former headquarters of Superior Oil on Flower Street into one of downtown’s first bastions of buzz; its rooftop bar and swimming pool instantly became one of the city’s chicest nightspots.
Although the 2008 financial panic and Great Recession slowed growth, downtown roared in their aftermath. Josef Centeno, the restaurateur behind Bäco Mercat and the Michelin-starred Orsa & Winston, found an audience of adventurous diners in the new apartments and condos, as did Grand Central Market, which pivoted to include hip, queue-drawing establishments like Eggslut. A similar culinary repositioning took place in Chinatown’s Far East Plaza, as the faded 1979 Broadway building became home to Roy Choi’s Chego in 2013 and, three years later, hot-chicken purveyor Howlin’ Rays. Nightlife impresario Cedd Moses launched the self-consciously louche watering holes Broadway Bar and Seven Grand, among others. ArtWalk, held the second Thursday of each month, drew throngs from across the city and allowed some businesses to make their rent in a single night.
Downtown wasn’t for everyone; thousands left when their leases expired. But a robust coalition of early adopters was there to stay, despite the lack of conveniences taken for granted elsewhere in L.A. When a Ralphs held a grand opening downtown in 2007, then-mayor Antonio Villaraigosa cut the ribbon, congresswoman Lucille Roybal-Allard appeared, and more than 1,000 showed up to celebrate. My newspaper titled its story “Let There Be Ralphs.”
The Central City Association, led for more than two decades by Carol Schatz, stoked growth by pitching out-of-town investors on the area’s potential. Increasingly, national and international developers sniffed profits in the housing sector, leading to a mix of shiny skyscrapers and forgettable seven-story apartment complexes. Neighborhoods became the Next Big Thing at a dizzying pace, from the Historic Core and the Financial District to Little Tokyo and South Park. The transformation of the Arts District was especially dynamic, bringing a branch of the members-only SoHo House to a formerly dilapidated Santa Fe Street building. Since 1999, according to the Downtown Center Business Improvement District, $34 billion has been invested in the area.
“When we got there with the Standard, it surprised a lot of people,” says Amar Lalvani, CEO of the hotel’s parent company, Standard International. (The hotel is currently closed, due to the pandemic and a renovation of the lobby overseen by original designer Shawn Hausman, with plans to reopen at an unspecified date.) “In the early days, we had the market to ourselves. Now there’s a lot more competition, which we view as a great thing because there are so many exciting things happening, leaving aside the pandemic.”
The cultural evolution was just as sweeping. The opening of the $140 million Broad museum in September 2015 and the debut of the Hauser & Wirth gallery in a former flour mill in the Arts District the following spring turbocharged a revving arts scene. The Regent, the Teragram Ballroom, and the Theatre at Ace Hotel became mainstays for touring bands and DJs. A 12-screen outpost of the Austin-based Alamo Drafthouse opened in the summer of 2019 in a revitalized shopping center on 7th Street. Downtown may not have reached 24/7 status, but it was on the way. Before the pandemic, says Suzanne Holley, president and CEO of the DCBID, “We were at the peak with no end in sight. Things just kept getting better and better.”
Even if the New York Times ranked downtown No. 5 on its “52 Places to Go in 2014,” the transformation was patchy. Staples Center and L.A. Live served as job generators and drew big crowds for games and concerts but felt detached from the lives of most residents. As the population increased, so did crime, especially vehicle break-ins. Chains such as Urban Outfitters and Ross opened on Broadway, but the bustling Oxy trade at 5th and Broadway continues to unsettle neighbors. A group of families opened a charter elementary school in 2013, aiming to serve the wave of affluent residents, but an inability to find a landlord willing to provide space for a permanent location resulted in it moving several times before closing in 2019. Even before the pandemic, one of downtown’s most noticeable projects stalled when its Chinese parent company encountered financial trouble. The weirdly named Oceanwide Plaza, a $1 billion development slated to include more than 500 condos, a Park Hyatt hotel, and commercial space, sits skeletal and unfinished overlooking Staples Center.
Then there is José Huizar, the disgraced former city councilman who stands accused of racketeering and operating a pay-to-play ring that feasted on the downtown real estate community. Federal prosecutors allege that developers directed cash or campaign donations to Huizar and his wife, Richelle, and in exchange received help greenlighting their projects. After Huizar’s home and offices were raided by the FBI in November 2018, he was politically neutered, leaving downtown without a City Hall champion for almost two years until his replacement, Kevin de León, was sworn in last October.
Still, downtown’s greatest challenge remains its longest running. Homelessness has been part of downtown’s fabric for decades, and, in the absence of a coherent city policy to quell it, the area has improvised around it. While the 50-block Skid Row is rife with abject poverty and tents that swallow entire sidewalks, neighborhood advocates who sweep the streets, house, feed, and otherwise aid people without resources, kept the situation from spinning completely out of control. Until, that is, COVID shattered that network and exposed the consistent failures by city leaders.
Though mayors including Garcetti and Villaraigosa launched campaigns to get people off the streets (Garcetti directed hundreds of millions of dollars toward the effort), Los Angeles has gone in the wrong direction. The 2020 Greater Los Angeles Homeless Count tallied more than 66,000 people experiencing homelessness, up 12.7 percent over the previous year. The health-care and economic crises, combined with underinvestment in emergency shelters and temporary housing, has resulted in what Union Rescue Mission’s Bales labels an “imperfect storm. As hard as it is to believe, it has absolutely never been worse than it is right now,” he tells me. “There are more people on the streets of Skid Row and downtown than there have ever been, and there have never been fewer places for people to go and stay safely.”
It is uncertain what happens next, but anger and worry in the community remain widespread. As do the tents.
Downtown’s current cascade of challenges include how it is perceived. The arrival of upscale residences and bars serving $15-a-shot small-batch bourbon, and the tenants they attract, is cited by some as the cause of widespread displacement of poverty-stricken inhabitants. That’s not quite accurate. Yes, some longtime residents of the Arts District left as rents spiked, and housing activists point to the protracted battles necessary to preserve affordable units in places such as the Bristol and Alexandria hotels. But the overwhelming majority of new market-rate apartment and condominium projects rose on former parking lots, or filled office buildings that sat empty for decades. Some pigeons and rats might have been forced out, but long-term covenants usually protected the residential base of low-income properties.
Critics tend to overlook the newly commissioned buildings that house homeless individuals, among them architectural landmarks like the $40 million Star Apartments, which opened on 6th Street in 2014, and New Pershing Apartments, a $32 million endeavor that created 69 permanent supportive housing units while preserving the Victorian façade of a Historic Core building that dates to 1889. In January, a rapidly constructed $48 million homeless housing project, with 232 units, largely funded by CARES Act dollars, opened on Vignes Street.
The truth about downtown is that it’s complicated—the megawealthy and the impoverished intermingle there like nowhere else in Los Angeles. Few realize that downtown actually comprises more than a dozen disparate districts, from the low-slung developments spreading in the Arts District to the government buildings populating the Civic Center. South Park has little in common with the Jewelry District. The same goes for Bunker Hill and Little Tokyo. It’s also easy to forget that downtown is still only in the middle stage of its reinvention. It was moribund 22 years ago, the place where hundreds of thousands of people each day would drive in for work and then drive home. There’s a reason why the major planning document for the community is labeled DTLA 2040; some of the most important growth is yet to come.
“Downtown is now full of real stakeholders, not just people who come in and work and leave,” Garcetti says. “A balanced set of stakeholders that say, ‘Yes, we want to see nightclubs and restaurants, but we want parks and schools.’”
The pandemic has brought downtown to a crossroads moment. Neighborhood-defining restaurants have disappeared, among them Bäco Mercat in the Historic Core, Broken Spanish in South Park, Bon Temps in the Arts District, and Plum Tree Inn in Chinatown. The trouble endures across all sectors. The DCBID’s year-end market report put the downtown office vacancy rate at 16.9 percent, up from 14.7 percent in the fourth quarter of 2019, while hotel occupancy plummeted to barely 25 percent. The average residential rent has tumbled by about 7 percent, according to the CCA. Bill Cooper, who has been selling condominiums in downtown since 2002, said prices are generally 5 to 10 percent less than they were a year ago. A vaccination program won’t quickly fill the empty spaces. Rising expects “two years of pain” as cautious CEOs assess how much office space they need. Rosenfeld also predicts a slow climb from the depths. The forecasts that he believes peg 2021 and 2022 as recovery years. “And in 2023, we will be back where we were a year ago,” he says.
Downtown’s advantage is that it is not starting from zero. The tens of billions sunk into the area in the past two decades provide an almost “too big to fail” foundation. Further, points out Nick Griffin, executive director of the DCBID, half a dozen major projects are currently under construction, including the billion-dollar Frank Gehry-designed development the Grand, which is rising across from Disney Hall and will have upscale residences, an Equinox-branded hotel, retail shops, and restaurants. Garcetti points to the Regional Connector, a $1.75 billion infrastructure improvement that will speed travel by tying together three Metro lines in downtown; and the West Santa Ana Branch Transit Corridor, a 19-mile light-rail line that will connect downtown with southeast L.A. County. Cooper touts the Apple flagship store coming this year to the old Tower Theater at 8th and Broadway and the Paul Smith boutique that opened on the same block last July (now temporarily closed) as indications that downtown will rebound. Economic trends will help. “Interest rates continue to be ridiculously low,” he says.
Some facets of downtown life will change. The tech workarounds of videoconferencing and cloud-based software that sufficed during the pandemic could encourage companies to have many employees come to the office only two or three days a week, just enough, perhaps, to bring back some of the vital lunchtime business that evaporated last year. Too, the recent dramatic decline in new COVID cases and arrival of three highly effective vaccines could presage a much earlier return to something resembling normal than originally predicted. There is a growing consensus that CEOs want their teams to interact in person again, and younger workers worry that they will be overlooked in companies where most communication is virtual. COVID-inspired design changes are a certainty. “We will have touchless elevators, which we were headed toward anyway,” says Rising. “We’ll have touchless faucets. I think we will have better air-handling systems or maybe even fresh air in our office buildings.”
Rising believes that the owners of some 1980s-era downtown office buildings may be unable to afford major renovations and could sell to developers who turn the properties into housing. When new deals are signed, even negotiations will be different. Contracts, predicts Moore, “are all going to include some type of a pandemic clause, that if we were to have something like this again—i.e. COVID-25—they will go to either an abatement of rent or some formula that allows for a forgiveness of rent. These will be new things landlords have not seen in the past but will have to be prepared for.”
Additional enthusiasm for the future stems from the makeup of the downtown populace. Besten notes that while some businesses have gone under, a tight-knit community supports those still open. Indeed, on an early afternoon in mid-February, after outdoor dining restrictions had been lifted, patios across downtown were packed with unmasked patrons, from the Arts District sausage-and-beer joint Wurstküche to the Yard House at L.A. Live. Downtown has recovered from a century’s worth of calamities, among them the 1918 flu pandemic, and so will likely prevail again. “There is inherently a belief that we will overcome this. There’s a historic track record to prove that we have,” says Lall.
“I think there’s a real pride here,” adds Brown. “It means something to be a downtowner and part of something unique. I think it can bounce back.”
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