It’s almost impossible to venture into Downtown Los Angeles without stumbling upon construction work.
According to the Los Angeles Times, Downtown LA hasn’t seen this much construction since the 1920s:
“Downtown Los Angeles is undergoing its largest construction boom in modern times — an explosion juiced by foreign investment that’s adding thousands of residences, construction jobs and a multitude of shops and restaurants.”
According to Marketplace, “The average rent for a one-bedroom apartment is about $2,500. But with so much construction happening so fast, the vacancy rate has climbed to about 9 percent — the highest in Los Angeles.”
The high-profile construction is happening in the South Park neighborhood where Chinese developers are involved with almost half of the land deals valued at $19 million according to Transwestern.
According to the Los Angeles Times from the Metropolis from Shanghai’s Greenland Group, “another marquee South Park project from a Chinese builder is the $1-billion Oceanwide Plaza, being built across from Staples Center by Beijing-based Oceanwide Holdings.
Slated to be completed in 2019, the development will include 504 condos and 184 hotel rooms in three towers. There will also be 166,000 square feet of shops and restaurants and a massive LED screen wrapping the west side of the project overlooking Figueroa Street.”
Chief executive of Oceanwide’s American subsidiary, Thomas Feng is is counting on the millions of people who attend events to show up at the Oceanwide Plaza.“The draw power of this location is tremendous. We’re in the heart of the entertainment and sports district,” Feng said.
Experts say that this sudden growth in construction can be traced back to 1999 when the Staples Center opened and when Los Angeles’s reuse ordinance took effect which made it easier for developers to redevelop old, vacant office buildings downtown into residences.
That’s when the Staples Center opened and the city’s adaptive reuse ordinance took effect, making it easy for developers to redevelop old, vacant office buildings downtown into residences. Though the recession put this growth on hold, as the economy recovers, Downtown Los Angeles is recovering as well.
Managing director of capital markets for JLL Investors, Chris Casey said, “Investors and developers said ‘Hey, this is a big city and there is not a lot of new product here and it seems there is a little niche and a real opportunity to fill that.’”